Chelsfield and Land Securities, the two companies shortlisted for the London Underground Property Partnership (LUPP), have confirmed they will stay in the running for development schemes despite the decision this week to effectively scrap LUPP.
Nigel Hugill, chief executive of Chelsfield, said: “I would like to think that whatever happens we are particularly well placed for whatever big projects may come up.”
On Monday it was confirmed that London Underground’s property assets will be transferred to Ken Livingstone’s Transport for London (TfL) to be sold individually. London Underground has not officially said that the LUPP will be abandoned.
Negotiations between the two shortlisted companies and LU have taken over two years, costing LandSec around £3m and Chelsfield £1m.
Hugill said that Chelsfield would not ask London Underground to return the £1m it has spent on its bid.
Hugill said: “In some ways we would prefer it to be done piecemeal. While there is a chance that we may not have won the LUPP contract instead of LandSec, we are fairly confident that we could win some of the bigger schemes.”
Manish Chande, chief executive of Land Securities’ outsourcing arm, LS Trillium, said that the company was “awaiting formal notification from London Underground with regard to the next steps on LUPP”. However, it is thought that both companies will continue to bid to be development partner on bigger schemes, such as Victoria and Green Park stations.
Under the original LUPP proposals, a portfolio of 50 surplus properties with a development value of £2bn-£3bn would have been transferred to LandSec or Chelsfield, the final short-listed bidders, while development profits would have been shared over 20 years.
However, a spokesman for TfL, said: “The London Transport property portfolio will be handed over to TfL when the other Tube deals go ahead. The properties will then be sold off and developed on a case-by-case basis, instead of the original plan of handing it over as one big chunk.”
He confirmed that the piecemeal approach would effectively kill off LUPP in its original form.
EGi News 09/01/02
