In September 2006, Sefton Borough Council had an office requirement of 80,000 sq ft in the town of Bootle. They were looking for space at under £9 per sq ft, and put out a tender notice in the Official Journal of the European Union.

Nightingale Estates had a building of exactly 80,000 sq ft to suit, called Magdalen House. It had recently been vacated by the Health and Safety Executive, was in need and they bid for the contract.

Sefton looked at competing space in Bootle and decided it was all too expensive at £9 per sq ft. Nightingales’ property needed refurbishment, but they started negotiating with Sefton…

Name

Magdalen House

Client

Sefton Metropolitan Borough Council

When it happened

2005-07

Budget

Less than £720,000 per year

Brief

Provide 80,000 sq ft of quality office space in Sefton for less than £9 per sq ft.

Aims

• Provide modern, refurbished offices
• Agree a rent that constituted value for money for both Sefton and Nightingales
• Find a way to finance refurbishment of the property

How it was done

Negotiated deal with Sefton to refurbish building to an agreed specification

In return, Sefton took up new leases for 25 years on the entire building at £6 per sq ft

Refurbishment funded through finance from Yorkshire bank, secured against 25 year lease offered by the council

Able to offer cheaper rent because of the long lease

Key benefits

1/3 of market rent for similar buildings in the area

Profit for Nightingale when building sold in 2007

Full refurbishment achieved with no cost to the council

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