P.I.G - not a farmyard animal, but the council’s Property Investment Group - the body which has spent nearly £60 million on buying land across the country in the last few years.
Setup almost two years ago, Wokingham Borough Council’s (WBC) investment group was given a £100 million war chest to buy properties in order to generate cash for its in-demand day-to-day services.
READ MORE: These are the properties Bracknell council has spent more than £81 million on
This means capital funds are borrowed from the Treasury to buy the sites, in turn generating rental income which the council can spend on social care support, staff salaries, its bin collection service and more.
Graham Ebers, WBC’s finance chief in charge of the scheme, said: “I like to think we have gone about finding new ways of income to support those social care costs at such a bleak time in terms of local government funding.
READ MORE: Council spends £41 million on these sites
“It is incumbent on me to make sure we do this in a responsible way because it is public money and I have to find new ways to generate income, but I also have to be cautious as I can be, diligent and responsible with the use of public money.”
The PIG is made up of Mr Ebers, three other finance and investment chiefs, Conservatives Cllr John Halsall, executive member for finance Cllr John Kaiser and executive member for economic development Cllr Stuart Munro.
Guidance issued from the Chartered Institute of Public Finance and Accountancy (CIPFA) in autumn last year led to the PIG taking a new approach to the scheme which involves a greater focus on buying property within Wokingham borough.
The group is “constantly improving its understanding and operations”, according to a WBC report, and Cllr John Kaiser said “it a very important part of what this council is going to do going forward” at a meeting last week.
Despite this, Imogen Shepherd-DuBey, Liberal Democrats councillor, told the News she has concerns over the “decision-making process”, as she would “like it to be cross-party.”
She added: “I realise they want to make quick decisions but doing that with public money is not necessarily the most ethical route.
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“Putting our public services at the hands of the commercial property market is what I have concerns about - they should be properly funded.”
So far, WBC has spent almost £60 million on seven properties inside and outside the borough - and still has £40 million to spend next year.
Here’s how much each one cost and the rent WBC receives from each site’s tenants.
Value: £1,595,000
Annual rent: £80,000 (4.82 per cent net yield)
Cox Plastics, Wokingham
Value: £3,100,000
Annual rent: £225,000 (6.52 per cent net yield)
Mulberry Business Park, Wokingham
Value: £10,000,000
Annual rent: £712,000 (6.69 per cent net yield)
Alexandra Court, Wokingham
Value: £837,000
Annual rent: £78,000 (7.99 per cent net yield)
Wickes, Basingstoke
Value: £12,000,000
Annual rent: £692,000 (5.44 per cent net yield)
Stapletons warehouse, Peterborough
Value: £17,400,000
Annual rent: £900,000 (4.88 per cent net yield)
Value: £14,870,000
Annual rent: £672,000 (4.22 per cent net yield)
Total value: £59,802,000
Annual rent: £3,359,000
Net yield: 5.26 per cent
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