THE COUNCIL spent more than £14.5 million on three properties in Wokingham, it has emerged.

Plans were detailed at council meeting earlier this month showing investments set to be made by the council in purchasing properties including Barclays bank at Market Place, Cox Plastics Ltd at Fishponds Road and Rubbra 1 & 2, Alba, at Mulberry Business Park.

Councillor Pauline Jorgensen, acting leader of the council, said: “This is part of our property investment strategy to deliver a regular income to soften the impact of severely reduced government funding and help safeguard public services across Wokingham Borough.

“It’s just one of the examples where we’re thinking outside the box to reduce the impact of increasing demand for services on our taxpayers.”

Liberal Democrats councillor Lindsay Ferris quizzed the Executive Member for Business, Economic Development and Strategic Planning Cllr Stuart Munro about the purchases at a full council meeting on Thursday, November 22,.

He asked him about the anticipated rent income of £507,000 a year, which Cllr Ferris believed was too high a figure given potential landlord responsibilities the council could have to undertake.

Cllr Munro replied: “The council as a landlord may have different responsibilities at different properties, depending on the property and the lease in place.”

The councillor noted that the authority has a responsibility to maintain the properties at Barclays and Fishpond Road, but the tenants at Mulberry Park pay for its upkeep.

“Generally we are responsible for tenant care, income collection, and a lot of due diligence has been done on the lease, I can assure you.

“Our portfolio is a mix of both types of lease. The income quoted of £507,000 is not the annual income from the assets required, but an estimate of the likely gross income from the date of purchase to the end of March 2019.

“Annual income would be considerably greater. The £507,000 is an estimate of the likely rental income before paying out interest on money borrowed.

“For all of these properties, the actual net annual income after interest payments for the full year is likely to be just under £600,000. A true return on the cost of 3.8 per cent, which is a pretty good rate of return.”

Cllr Munro confirmed that the interest rate on the money borrowed was 2.9%.