In 2012 SPRUCE provided a c. £2m senior debt facility to Dundyvan LLP, a 50/50 private / public joint venture between CBC and Fusion Assets (part of North Lanarkshire Council), to be used for the speculative construction of c.44,000 sq ft of industrial units.
THE BACKGROUND
North Lanarkshire is one of Scotland’s primary locations for industrial property for SMEs, and one of the 13 most deprived local authority areas of Scotland which were the key target geographies for SPRUCE up until the fund’s first closing at the end of 2015.
The development was completed successfully to shell and core and has since been fitted out to meet tenants’ space requirements. At the time of entering into the transaction there were no pre-lets in place, with the co-sponsors working together through the construction phase and operational phase to secure tenants.
The project has demonstrated the alignment of the SPRUCE fund and Scottish Government strategic objectives with regard to government regeneration policy.
The project has delivered numerous benefits;
- the development and the remediation of a 1.24ha brownfield site which was identified on the Vacant and Derelict Land Register;
- new fit for purpose business space for up to 16 SMEs;
- an estimated 12 full time construction jobs being sustained;
- an estimated 117 full time jobs being created; and
- increasing access to development finance for speculative property projects and hence addressing the market failure evident in this lending market.
The project was the first of any of the projects funded with the assistance of the 2007/13 European Regional Development Fund to make a capital repayment, with the funds repaid having since been recycled into further projects.
SDG supported
Facts
FTE jobs created
117
Land remediated
1.24ha