Published Tuesday, 10th September 2019
Sutton Council has bought the long lease of the David Lloyd Club at Hannibal Way in South Beddington for £21.5m as part of its aim to increase property investments in the borough.
Sutton Council has bought the long lease of the David Lloyd Club at Hannibal Way in South Beddington for £21.5m as part of its aim to increase property investments in the borough. This will benefit Sutton residents by providing the council with rental income of more than £1m a year from the David Lloyd Leisure Group that it will spend on frontline services.
Sutton already owns the freehold and taking up the leasehold - which runs until 2036 - will increase the council’s control of the future of the property.
Councillor Sunita Gordon, Sutton’s lead member for resources, said: “We are ambitious for Sutton to become an even greater place to live, work and raise a family. To achieve this, we are committed to making good quality investments to help deliver Council objectives and protect services.
“Since we made it our policy to invest four years ago, we have put more than £53m into property, giving us an annual income of more than £2.5m to support council services. Our £21.5m investment in the David Lloyd Club will bring us another £1m-plus a year. This venture, plus our recent decision to buy the Four Seasons industrial estate, demonstrates our commitment to keep building a portfolio of prudent investments.
The David Lloyd organisation has spent more than £5m on modernising the club since 2017 and it is now one of the UK’s leading health, spa, fitness and racquets clubs. Our investment will extend our direct control of the future of this property.”
Notes to editors
David Lloyd Club in South Beddington
The David Lloyd Leisure Group announced in March that the club was to receive “a £2.5m investment programme to firmly position the club as one of the country’s leading health, spa, fitness and racquets clubs. The club will offer unrivalled facilities to help members achieve their health and fitness goals, The plans include a brand new luxury indoor and outdoor spa, the latest boutique-style fitness class; Blaze and upgraded tennis facilities.Since the club was acquired in 2017, investment has totalled over £5m on modernising and upgrading its facilities.”
The council granted a long lease in the 1980s for the facility to be developed and this is the interest it has bought back from vendors British Land. The property is subject to an occupational lease until 2036 and the Council will now become the direct landlord of the David Lloyd organisation.
Sutton Council’s investment policy
A policy to set up an Investment Property Portfolio (IPP) was approved at the Strategy & Resources Committee of 28 September 2015 and further revised by the same committee on 29 October 2018.
The aims of the Investment Property Portfolio are to support the economic viability of the borough and to deliver a secure medium to long-term investment return to help sustain the delivery of council functions.
Property investments over £53m have been made since the approval of the strategy, generating an additional net annual revenue income of £1m which is available to support the provision of council services.