MAN-MADE LAKES WILL BE A HAVEN FOR WILDLIFE AND A FOCAL POINT OF UK COAL’S WAVERLEY DEVELOPMENT ON THE SITE OF A RESTORED SURFACE MINE WHERE 3,800 HOMES AND ASSOCIATED RETAIL, LEISURE, SOCIAL AND HEALTH FACILITIES COULD BE DEVELOPED WITH EASY ACCESS TO THE M1 BETWEEN ROTHERHAM AND SHEFFIELD.
REVIEW OF OPERATIONS HARWORTH ESTATES
Harworth Estates produced a profit of £73.2 million (2006: £73.3 million), including gains on Investment Properties of £70.5 million (2006: £70.0 million), of which £66.8 million was unrealised (2006: £68.6 million). A further revaluation gain of £6.7 million was taken directly to reserves, being the gains recognised on former Operating Properties transferred to Investment Property status on their ceasing to be operational sites.
Key Performance Indicators (“KPIs”)
|
|
2007 |
2006 |
| RICS valuation of the property portfolio (£m) |
410.7 |
343.9 |
| Number of sites in Project Worth |
76 |
60 |
| 2012 estimate of Project Worth (£m) |
935 |
800 |
| 2013 estimate of Project Worth (£m) |
1,000 |
N/A |
The principal objective of Harworth Estates is to maximise the value of the Group’s property portfolio over the long term. To this end, the changes in values of the estate, as planning consents are obtained or become more likely, are measured as KPIs.
Harworth Estates controls and manages approximately 46,500 acres of freehold land, which is predominantly in England, on behalf of the Group. We announced, in 2006, our intention to enhance the value of this land bank, and, in particular, a portfolio of largely Brownfield sites, with the target of attaining a gross worth by 2012 of £800 million.
During the course of 2007, our estimate of worth, and the number of sites, have both been raised, such that it is our objective to deliver to shareholders £935 million of gross worth by 2012, through the gaining of planning consents on 76 sites, representing 13,800 gross acres of this land of which a net acreage of 3,696 will be developed.
There will remain, beyond this initial 5 year horizon, further significant value to be obtained from our land bank. We have therefore announced an estimate for 2013 of circa £1 billion of gross worth on these same 76 sites.
Much of this enhancement of value will come through the obtaining of planning consents for development, and the subsequent, or conditional, sale of parts of sites for development. We would intend that, in the case of residential land, we will strive to obtain planning consent, and would then invest in the major infrastructure, e.g. roads, utilities and section 106 (planning gain), then sell off smaller economically viable plots to house builders for development. In the case of commercial land, a more varied set of models would be employed, often involving the use of co-operation agreements or joint ventures with third parties where these parties bring particular expertise to the development of individual sites.