BBC agrees property deal to save millions
We will now save £75m a year from prudent property management, meaning even more of the licence fee will go on what matters most to our audience - the programmes they love.Anne Bulford, Managing Director, BBC Finance and Operations
Stanhope and Mitsui Fudosan to create White City Place
The BBC is today announcing the sale and sublet of its Media Village site in west London, which will now be known as White City Place, as part of ongoing plans to dramatically reduce the size and cost of BBC buildings.
This will mean the corporation’s property footprint is now reduced by around 40 per cent since 1998 – a significant achievement within the public sector.
Under the commercial terms agreed with Stanhope and Mitsui Fudosan UK Ltd ('Mitsui Fudosan'), the BBC will receive £87 million for the sale of four acres of freehold land and the lease of six buildings, three of which will continue to be occupied by the BBC. The BBC will make £33 million of annual running cost savings.
The three buildings being vacated by the BBC - White City One, Media Centre and Garden House - will be fully refurbished and brought back to the market from late 2016. The buildings will provide a range of types and sizes of tenancies totalling c. 600,000 sq ft. As part of the wider regeneration of the area, this will deliver a thriving and lively urban business environment which will be attractive to a wide range of creative industries.
Today’s announcement is the latest in a series of property moves that mean the BBC is on course to save in excess of £75 million a year on property costs by 2017 – an increase of £19 million from original targets.
Property is a key strand of the BBC’s efficiency plan, which will save £1.5 billion a year by 2017, meaning even more of the licence fee can be directed into programmes and services for viewers.
The BBC has upgraded to a smaller and more modern property estate that is fit for 24-hour broadcast in a digital age without increasing costs. This has also increased the number of BBC staff now based outside of the capital to 54 per cent.
Anne Bulford, Managing Director of BBC Finance and Operation, says: “The BBC is determined to work out of the minimum number of buildings possible whilst still representing the audience it serves.
“Today’s announcement is an excellent deal for licence fee payers. We will now save £75m a year from prudent property management, meaning even more of the licence fee will go on what matters most to our audience - the programmes they love.”
David Camp, Chief Executive of Stanhope Plc, says: “White City Place will become the commercial heart to White City. Together with Television Centre, we will be delivering close to 2 million sq ft of office space and nearly 1,000 new homes over the next five years.
“Alongside the BBC studios and Soho House at Television Centre, the John Lewis store, opening 2018, and the Imperial West campus on Wood Lane, White City is fast becoming the place to be.”
Hideto Yamada, Managing Director of Mitsui Fudosan UK Ltd, says: “The White City Opportunity Area covers 110 hectares which will see a significant and exciting amount of development come to fruition over the coming years, ensuring a full transformation of the area. White City Place will be designed to appeal to young and growing businesses and retailers, creating a fresh and vibrant business destination in west London. We are delighted to add this iconic asset to our growing London portfolio; the acquisition reflects Mitsui Fudosan’s long-term commitment to expand our investment strategy to strong markets outside of Japan.”
Notes to Editors
- The deal is the latest step in a phased move away from west London by the BBC that began in 2011. The exit from Television Centre last year alone raised £200 million and cut annual running costs by £30 million. The BBC vacated the White City One building of Media Village in March 2013 and began marketing the site with a view to securing best value for money.
- The BBC has disposed of buildings it no longer needs. The estate has been reduced from 213 buildings (640,000m²) to 154 (389,000m²) - a 40 per cent reduction or 35 football pitches' worth of floor space. As projected in the recent National Audit Office report, the disposal of Media Village has now reduced vacant space across BBC buildings from 9.3 per cent to as little as 2.6 per cent. The area per person has also been reduced by 25 per cent from 14.8 square metres to 11 square metres.
- White City Place includes six main buildings: the White City One building, Media Centre and Garden House to be vacated by the BBC, and the Broadcast Centre, Energy Centre and Lighthouse to remain occupied by the BBC.
- White City Place currently accommodates a range of buildings designed and utilised as office and broadcast technology space. The total office floor area is 87,752m², or 10 football pitches, together with an adjoining vacant freehold site of four acres with the benefit of an existing planning consent. The buildings occupy a site of 17 acres on Wood Lane, within a short walk of Television Centre. Stanhope and Mitsui are currently redeveloping the 14 acre site Television Centre - including 500,000 sq ft of offices, 950 new homes, Soho House, three BBC studios and the newly opened BBC Worldwide HQ.
- Stanhope and Mitsui will undertake major landscaping and infrastructure works to White City Place to significantly improve the public realm, including gardens and plazas and to reinforce connections with the nearby stations, Television Centre and Imperial West. Stanhope and Mitsui intend to submit a planning application later this year for new office development and landscaping on the southern gateway entrance site. Allies and Morrison have been appointed as architect to master plan the site.
- White City Place is located within the White City Opportunity Area Planning Framework. This is further enhanced by the success of the nearby Westfield Shopping Centre with plans and consent to extend further north, a new proposed development of approximately 1,500 new homes by St James and Imperial College’s ambitious plans to develop a new campus and research facilities on the east side of Wood Lane directly opposite Media Village.
- White City Place was the original home of the Franco-British Exhibition of 1908, which created a vast complex of white pavilions and pleasure parks in Wood Lane and which gave the area its name of 'White City'. The site then provided the home for the 1908 Olympics stadium, the first Olympic Games to be held in the UK. Parts of the swimming pool were discovered when the foundations were laid. The site was later turned over to greyhound racing before the BBC acquired it in the mid-1980s.
- The deal was negotiated after an 18-month competitive process. Initial expressions of interest were reduced to a shortlist of three bidders. The BBC’s primary duty was to secure the best deal for licence fee payers. As with all commercial deals, the BBC carried out its due diligence with regard to all shortlisted bidders and concluded that the structure of the finally agreed deal was commercially appropriate and lawful.
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