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Spelthorne BC has dismissed media criticism of its landmark investment in commercial property. It comes after claims in the national media that the investment was a 'bet'. But responding to the criticism this week the council insisted its investment in the BP office park was made after thorough research. In September the council beat national and international investors to buy the office park for a fee thought to be around £360m. The council said it worked closely with property advisors Cushman & Wakefield, which has been working with the council for 25 years, before making the decision. Deputy chief executive Terry Collier said: 'We are not just doing this on our own. 'We are using very reputable advisors. 'They are one of the biggest consultants in the world and they understand the borough very well.' The unique qualities of this site - only 3.5 miles from Heathrow, near the M3 and M25, close to London and the planned Crossrail 2 project - was a key reason for the council's decision to purchase the site. Spelthorne added BP was viewed as a very high strength tenant because of its high credit rating. Mr Collier continued: 'If they were to go into financial trouble the whole economy would go into a mess because virtually everyone's pension funds receive dividends from BP.' Although the council recognises the scale of the investment, it nevertheless classifies it as a low-risk transaction. The site does not require hands-on management by the council, which BP has taken responsibility for, while the buildings are also fairly new and have been maintained well over the years. Although there were other investors interested, Spelthorne said buying it gave the council greater control over a key asset within the borough. The council said no other single option would generate the level of additional income that this opportunity promised for the council, which has tried to make savings in other areas by sharing work with other local authorities and renting out office space. One national newspaper had likened councils' commercial investments to 'punting like drunken sailors all around the country.' However, Mr Collier said the council was very careful to make sure it understood the risks involved in its investments, adding: 'I'm not saying that all property transactions are low risk but it comes down to understanding those risks.'

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Spelthorne BC: BP investment not a 'bet'

By Hiba Mahamadi | 09 May 2017

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