Circle Property agrees sale of three office assets

Circle Property announced on Monday that, in line with its disposal strategy, it has exchanged contracts on the sale of Kents Hill Business Park in Milton Keynes, which contains around 80,576 square feet of office accommodation.

The AIM-traded firm said the sale was to Corum XL at a combined sale price of £17.23m, making for an increase of 10.1% on the 31 March valuation of £15.65m.

It said the sale of the first two buildings, K1 and K2, completed simultaneously on exchange at a sale price of £12.73m.

Completion of the sale of the final building, K3, at a sale price of £4.5m, was expected to take place prior to the end of the calendar year, following the refurbishment that was currently underway.

Kents Hill was acquired by Circle Property in December 2013 for £11m, and the profit before tax for the year ended 31 March attributable to Kents Hill was £0.56.

In addition, the company exchanged contracts on the sales of Cheltenham House on Temple Street in Birmingham, which consists of around 16,469 square feet of office and restaurant accommodation, to A S Leisure Properties for £4.7m.

It also agreed the sale of Elizabeth House on London Road in Staines, consisting of 14,829 square feet of office accommodation, to MAP Commercial Properties for £3.5m.

The sale prices represented a decrease of 9.6% and an increase of 16.7% on the 31 March valuations of £5.2m and £3m, respectively.

Completion was respectively expected on 7 September and 28 September.

“As previously announced in June, the company repaid the amount outstanding under its debt facility in full and is now debt free,” the board said in its statement.

“The net proceeds from the disposals will be held as group cash, and the board expects that a minimum of two returns of capital will be made to shareholders, the first of which is expected to occur by March 2023.

“Following completion of the sale of Kents Hill K1 and K2, the company's net cash balance is approximately £16.5m.”

At 1003 BST, shares in Circle Property were flat at 245p.

Reporting by Josh White at Sharecast.com.