U and I Group PLC (U+I) announces that it has exchanged contracts to sell a one-acre site at Cross Quarter Abbey Wood to residential developer HUB, realising profits of c. £2.5 million, slightly ahead of previous guidance.
HUB, who is also developing at The Old Vinyl Factory in Hayes, will deliver hundreds of mid-market homes on the site in partnership with Bridges Ventures. The sale marks the final phase of delivery at Cross Quarter, an £85 million regeneration project which has transformed a formerly vacant industrial site close to Abbey Wood station into a new mixed-use community.
Construction of the first phase of Cross Quarter, which was forward-funded by Canada Life, completed in August 2015. In its role as developer, U+I delivered an 81,000 sq. ft. supermarket, pre-sold to Sainsbury’s, and a 32-unit residential tower which was pre-sold to a residential partner. The sale of the final parcel of land announced today takes the profit generated on this project to date to £7.5 million, representing an IRR of 40 per cent. Today’s announcement takes the total profit realised in the year to date to c. £5.5 million, contributing towards the Company’s anticipated FY 2016 gains of £54 million.
Matthew Weiner, Chief Executive, U+I said:
“Cross Quarter perfectly demonstrates our skills and approach to mixed-use development which have enabled us to regenerate a redundant but well-connected piece of land into a vibrant new gateway destination for Abbey Wood. We developed the first phase of the project having de-risked our position through pre-sales and forward funding, delivering a high quality mixed-use community which is now fully occupied.
The land improvement profit delivered from the disposal of the remaining residential site is in excess of our original underwrite, demonstrating the continued demand for mid-market residential space in Greater London and the South East, a market in which we are particularly active. Today’s announcement adds to our pipeline of projects that are contributing to our anticipated full year gains.”