Property News

Joint venture established to accelerate delivery of Liverpool regeneration projects

Thursday, May 10, 2012


Sigma, the property, finance and urban regeneration group, is pleased to announce that its property subsidiary, Sigma Inpartnership, has formed a joint venture company with a major local property development company, Neptune Developments Limited ("Neptune"), to accelerate the delivery of its regeneration projects in Liverpool.  The joint venture, called Neptune Inpartnership, will develop commercial sites across the city and will share the development management fees and development profit on a project by project basis.  The sites will be allocated to the joint venture from urban regeneration work arising from Sigma's partnership with Liverpool City Council, Regeneration Liverpool (also referred to as the Liverpool Partnership).

The commercial developments are expected to generate fees and profit share to Sigma in the order of 3-4% of the total development value of each project. Revenues from the first two projects, outlined below, are expected to commence in the third quarter of 2012 and work on the two projects is expected to take three to five years, with revenues spread evenly over the respective development periods. 

Neptune Inpartnership's first project is the delivery of a major mixed-use development at Stonebridge Cross, with a total development value estimated at £120m. A hybrid planning application for the development is currently in preparation and the development is expected to be completed over the next three years. The scheme is expected to comprise a new secondary school, a 70,000 square foot foodstore, ancillary non-food retail stores, health centre, budget hotel and associated family pub as well as around 450-500 new homes. It will also include a major new public park and the restoration of the River Alt. 

Neptune Inpartnership will also be involved with the regeneration of the Lime Street and the Knowledge Quarter area, a project which is seen as a flagship development for Liverpool City. The total development value of the project is estimated at £140m, with the work taking place over the next three to five years.  The project will require the preparation of both a masterplan and delivery plan covering the area, which is bounded by Lime Street, Mount Pleasant, The Metropolitan Cathedral/St Andrews Gardens and Lord Nelson Street.  A key objective of the work is to enhance the quality of the routes between Liverpool City Centre and its two Universities.   

As part of the Liverpool Partnership, Sigma Inpartnership is also already delivering an existing major regeneration project at Norris Green Village, a 63 acre site five miles from Liverpool City centre.   This involves a rolling programme of development for the creation of a further 800 or so new homes with a development value of around £120m.       

Graham Barnet, Chief Executive of Sigma, commented,

"The establishment of this joint venture company with Neptune Developments Limited will help to accelerate the delivery of the regeneration opportunities we hold in our partnership with Liverpool City Council.  As we previously reported, the scope of our partnership was significantly increased at the end of last year to encompass further sites.  Our joint venture with Neptune is a significant step towards the delivery of the Council's regeneration objectives and helps to crystallise further value for Sigma."

Steve Parry, Managing Director of Neptune Developments, commented,

"We are delighted to have formed this new company with Sigma which significantly enhances our delivery pipeline for the next 10 years in the City.  Sigma Inpartnership has created a unique vehicle with the Liverpool City Council and their partnership philosophy fits perfectly with our own. It is a fantastic opportunity to combine expertise and delivery credentials for the benefit of the City"   

Enquiries

Sigma Capital Group plc www.sigmacapital.co.uk

Graham Barnet, Chief Executive
Marilyn Cole, Finance Director

T: 0131 220 9444

Biddicks

Katie Tzouliadis
Sophie McNulty

T: 020 3178 6378

Singer Capital Markets Limited

James Maxwell
Nick Donovan

T: 020 3205 7500

About Sigma Inpartnership

Founded in 2001 and operating from offices in Manchester and Birmingham, Sigma Inpartnership was established as an investment led property-related regeneration company, specialising in the creation of long term, asset-backed partnerships with the public sector.

Sigma Inpartnership has three partnerships, with Liverpool City Council, Solihull Metropolitan Borough Council and Salford City Council, each ranging from 10 to 20 years' duration.  Each partnership holds long term option arrangements with its respective local authorities for a mix of residential, commercial, education and health opportunities. In total, the partnerships provide for the delivery of around 10,000 new homes, a significant number of new local retail centres, health/medical centres, schools and major retail/ mixed use commercial facilities.

The total development value of the opportunities held within the three partnerships is estimated at over £2 billion.

About the Regeneration Liverpool (also referred to as the Liverpool Partnership)

Regeneration Liverpool is a limited liability partnership, legally constituted as the Liverpool Partnership LLP and formed in March 2007 with Liverpool City Council. It has been established to re-develop any surplus land assets at the discretion of the Council.

Land in the Partnership can be developed using any combination of the following three scenarios : by the Liverpool Partnership - Sigma Inpartnership earns a management fee and participates in a profit share; by Sigma Inpartnership or Neptune Inpartnership - Sigma Inpartnership earns a fee and an agreed priority profit; or by the Liverpool Partnership selling a site on the open market - Sigma Inpartnership earns a percentage of the sales price achieved.  At least 20 per cent. of the land must be disposed of by sale on the open market. 

About Neptune Developments Ltd

Established in 1989, Neptune operates as a property developer in the North West and West Midlands.   The Company specialises in major area based regeneration schemes often involving complex site assembly.  Over the last four years, Neptune has successfully completed over 1 million square feet of mixed use, retail and leisure development.  Neptune is also highly experienced in working in partnership with others including local authorities, agencies and private land owners. 

Neptune has built an enviable reputation for the delivery of challenging and high profile projects and infrastructure including the £135 million Mann Island Scheme, £70 million New Brighton Project and the ongoing development of the Interchange Wolverhampton which has a development value of over £100 million. The development portfolio is approaching £500 million to date with a number of new projects at the planning stage.