Somerset Council has chosen to stagger the sale of its commercial assets to avoid appearing as a “weak wildebeest” to opportunistic bidders. Since 2023, the council has been gradually selling surplus land and properties inherited from former district councils. Uniquely, proceeds from these sales are allowed by the government to fund front-line services—a temporary measure set to end after April 2027.
The council’s cautious approach aims to protect its reputation and maximize financial returns for taxpayers. Olly Payne, head of capital markets for UK regions at JLL, updated the council’s property and investments executive sub-committee in Taunton on June 17, explaining the rationale behind the phased sales strategy. He emphasized the unpredictability of the global property market, influenced heavily by inflation, interest rates, and geopolitical events like the conflict in Iran.
“We recommended a strategic sale of assets over four years because rushing into the market could have looked like a desperate fire sale and resulted in lower asset values,” Payne said. He noted that while the year began positively with rising prices across most sectors, factors such as expected interest rate hikes and increased development costs have complicated the market outlook. However, rents have grown due to limited supply and minimal new development.
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To date, the council has sold approximately 60% of its asset portfolio, generating over £125 million—about £8.6 million more than initial valuations. The largest transaction was the sale of the Steelite factory in Stoke-on-Trent for £14.4 million. Additional assets valued at over £24 million are currently under offer. Buyers range from small property firms and a major French investment company leveraging UK tax advantages to wealthy private investors attracted to tangible real estate investments.
Council leader Bill Revans expressed cautious optimism, calling for consistent government policy to support local authorities’ funding strategies. “We’re not in the best position, but not the worst either. It feels like a mid-table performance," he said. “The government encouraged investments and later urged sales—some consistency would help.”
Payne confirmed that maintaining a steady, measured approach would help safeguard returns and the council’s reputation. When news of the asset sales broke, some bidders proposed significantly undervalued offers, seeking to capitalize on Somerset’s situation. “If we had accepted those, it would have been a bad move,” Payne remarked. “By selling orderly and gradually, we dispelled the perception of being vulnerable.”
The council’s strategy has effectively deterred opportunistic buyers and positioned Somerset to secure fair value for its remaining assets without damaging its standing in the property market.