Desmond Bloom enters the pub market
Desmond Bloom, former chairman and managing director of property group Premier Land, has formed a new venture, Equable Properties, and acquired ten pubs.
Equable has bought the portfolio, which is spread throughout England and Wales, for £4.5m in cash and 12m shares in the new entity.
Property agents Knight Frank valued the portfolio, which consists of "predominantly freehold" sites, at £5.7m.
The group, which launched on the AIM stock market today, said it plans to acquire more commercial properties, both in the UK and overseas.
In its share placing document Equable noted that rent from the pubs - in the region of £459,000 per annum -"will be insufficient to service the associated debt and to meet the company's overheads, the company will be loss-making until one or more additional acquisitions are completed".
Bloom said: "I am strongly of the opinion that commercial properties will continue to enjoy capital appreciation as a result of rental growth in a buoyant UK economy.
"For this reason, we are delighted to offer investors a platform, in the form of Equable Properties, to participate in what I intend to be a diverse and solid UK portfolio with the possible additional upside of potential exceptional returns from the developing economies of Eastern Europe."
The group "considers that a real estate investment trusts (REIT) structure is not an appropriate or attractive option for the company at present though the directors will review this position from time to time".
