Town centre firm WEL moves into profitBy Victoria Smith
October 20, 2011
The taxpayer-owned firm launched to manage town centre assets as the regeneration gets underway has reported its first profit.
Wokingham Enterprise Limited (WEL), which is owned by Wokingham Borough Council, has made nearly £10,000 in profit so far this year and is on track to continue until the end of the financial year.
Filling the last of a row of empty shops that have been a blot on Peach Street for several years has turned around the fortunes of the company, although the impending regeneration will have a significant effect on the firm’s balance sheet.
In May this year The Wokingham Times reported how the firm had made a loss of £10,000 to the year ending March 2011.
Councillor Matt Deegan, executive member for community development, said: “After a lot of work trying to find the right sort of tenants for the town and for the types of units we have available we are delighted to have now filled the empty units.
“Having more tenants clearly puts WEL in a stronger position.
“This is the first time we have reported a profit since we acquired the assets, but bear in mind we had six vacant units when we acquired them.
“We are still not maximising the assets, a lot of work needs to be done. However we need to be a little more patient as we move towards the implementation of the town centre regeneration.”
A summary of profit and loss for WEL shows the company has taken £347,964 in income in the year to date and is expected to take £642,000 during the full financial year.
WEL was set up by the council last year to purchase land in Peach Street, Market Place and Rose Street from developer Rock Investment Group, which had failed to get its own regeneration schemes for the site off the ground, in a £10 million deal.
It is managing the shop, office and flat units on the site while the council works on plans to regenerate the land, as well as Elms Field in Elms Road.
Expenditure by WEL includes paying back interest on the loan the council took out to fund the purchase of the land, which will be £423,012 this year, and directors’ fees, which will be £42,000 this financial year.
Cllr Deegan added the council would not realise the full potential of the Peach Street site until the regeneration had been complete, which is forecast to happen in five years.
He said: “When we acquired those units we found the state of the apartments was so bad they are uninhabitable. Because of that we can’t maximise the rental opportunity from the whole of the asset.
“To put them into a habitable state would require a significant investment.
“We bought them to enable to town centre regeneration, not for the rental income.
“We are not in a position to maximise those assets yet, but we will be.”
The regeneration of Peach Street, Market Place and Rose Street will see double-fronted stores and restaurants built so shops face onto the road and into what is now the Rose Street car park, which will be replaced with a piazza area.
Apartments will also be built above the shop units.
Cllr Prue Bray, leader of Wokingham Liberal Democrats, said: “WEL has made a very tiny bit of profit.
“I really think it is too early to say what the future will hold because we haven’t got anywhere with the town centre regeneration.”
The executive committee is due to meet tomorrow (Thursday) to discuss the latest on the town centre regeneration project.