EXCLUSIVE: The Ministry of Defence has awarded a two-year online auction contract to Lambert Smith Hampton as part of the drive to reduce its estate.
LSH is now working on plans for the first sale, which is scheduled to take place in May.
In a ringing endorsement of this relatively new route to market, the Defence Infrastructure Organisation, part of the MoD, invited firms to tender specifically to provide online auctions.
Robert Stone, head of estates at the DIO said: “The MoD has committed to reducing its estate by 30% by 2040.
“The appointment of LSH to deliver some of the planned disposals will be of great help to achieve this and we are very pleased we can utilise their innovative auction platform.”
He added: “The broad mix of disposals will comprise of parcels of development land, former farms, amenity land, retail and other disused buildings and sites”.
The MoD owns 424,000 hectares of land and is charged with rationalising its estate on to a smaller footprint that is more efficiently organised and intensively used.
National head of auctions at LSH, Oliver Childs, said: “It is a real privilege to have been awarded this contract by the Ministry of Defence.
“We have been pioneers in the online auction space and over the past two years have developed a track record of success having sold a wide variety of property all over the UK through our platform.
“Clients have included FTSE 100 companies, private equity firms, LPA receivers and the Homes & Communities Agency.
“We have consistently proved above-market values and we look forward to bringing these properties to the market.”
The first online sale is likely to include development land, vacant commercial buildings and cottages requiring modernisation.
LSH is likely to group smaller lots together to be auctioned on the same day, as it has done successfully for Severn Trent Water.
Larger, less-typical auction stock is likely to be handled separately with longer, bespoke marketing campaigns lasting up to three months. This is designed to reach a wider range of bidders and to allow them to carry out due diligence and arrange finance.
LSH is currently marketing one of its largest online lots: a development site in Bradford, being sold on the instruction of the receiver, with a reserve not to exceed £950,000.
“Online auction allows for a wider variety of property to be offered, both in asset value and aset type,” said Childs.
Severn Trent’s property and planning manager Gillian Bullimore has previously praised the process for allowing it to ensure best value is achieved and to demonstrate an “open, fair and accessible” sales process.
LSH was eligible to compete for the MoD contract having won a place on the government’s 33-strong Estates Professional Services framework last August. It is understood that other panel members tendered with proposals to subcontract the auction work.
LSH chief executive Ezra Nahome added: “This mandate is a further endorsement of our market-leading online auction platform.
“The direction of travel is clear and we are leading from the front, providing an efficient and transparent platform giving wide reaching investors the ability to buy property with confidence and certainty.”
To send feedback, e-mail julia.cahill@egi.co.uk or tweet @egjuliac or @estatesgazette
