Royal Mail has sold a chunk of land for luxury flats at a 565% mark-up.
The privatised postal giant is flogging 6.25 acres of its Mount Pleasant sorting office in North London to Taylor Wimpey for £193million. The land had a “net book value” of £29m.
It is the latest big money land sale by Royal Mail, which is locked in a dispute with unions over a pensions shake-up.
It means the firm will have made around £400m from three central London land sales.
There is planning permission to convert the Mount Pleasant land into 681 flats, shops and offices.
Less than a quarter of the flats will be designated ‘affordable’.
Around £100m will be spent on refurbishing the current Mount Pleasant sorting office, including building underground.
Royal Mail could make even more if Taylor Wimpey chooses to sell the two areas of land at Mount Pleasant – Phoenix Place or Calthorpe Street – on to someone else.
It confirmed: “Royal Mail will be entitled to 50% of any uplift in value achieved over the initial purchase price.”
Earlier this summer, Royal Mail agreed to sell 2.7 acres in Battersea, South London, to an American property firm for £101m.
The two plots are among seven on a 14-acre site at Nine Elms, close to the new US Embassy.
The £101m price is eight times more than the £12.9m “book value” Royal Mail had put on the land.
The postal giant previously sold its Paddington sorting office for £111m in 2014.
Yet Royal Mail’s prospectus before its 2013 privatisation put the “book value” of its entire British freehold property estate at £787m.
The privatisation raised nearly £2billion for the UK taxpayer.
Royal Mail shares were sold for 330p but rocketed on the first day and have remained above that price ever since.
The then Business Secretary Vince Cable, now leader of the Lib Dems, was criticised at the time.
Unite union’s Brian Scott said following the Nine Elms sale: “Royal Mail says it has no money and it is pleading poverty yet it has just sold two plots of land for more than £100m. It remains the case that RoyalMail was sold on the cheap.”
Royal Mail said: “Investors were provided with sufficient disclosure to assess the potential value of the property portfolio in the prospectus.”
Martin Gafsen, group director of property and facilities solutions at Royal Mail said: “The sale of our development sites at Mount Pleasant to Taylor Wimpey is a great opportunity for us to contribute to the regeneration of the area around our iconic Mail Centre building.
“This will create more housing, including affordable units, as well as community facilities and more public space. It will also help us secure the long-term future of our key central London operational site.”
The latest land deal came as it was confirmed that Royal Mail would be demoted from the FTSE 100 index of Britain’s biggest firms.