“Esplanade offices will make £95 million profit” – latest report

Tuesday 20 October 2015

An updated valuation report on the controversial Esplanade development says that it will turn a profit of £95 million – even after dealing with contamination and pollution on the site.

The development – which started a few months ago after years of delays – will turn a £95 million profit when it is finally finished, according to the fresh report by international property consultants DTZ.

That report puts the cost of the whole development, including all six office blocks, at £237 million.

But that point is many years away – the States of Jersey Development Company’s current plan is to have the first two buildings finished and rented out by 2020, with construction work underway on the next two. That would still mean that work on the last two buildings wouldn’t even have begun.

The valuation report comes with politicians still waiting for the delayed Scrutiny report on the Esplanade office project. That report has been promised since the summer, but has been repeatedly delayed.

In July, the head of the Scrutiny review revealed that his panel has been told to sign non-disclosure agreements with damages clauses worth millions of pounds if the content of evidence that they saw leaked out into the public.

Treasury Minister Alan Maclean said that the independent valuation should reassure Islanders about the project.

Senator Maclean said: “It was important to commission an independent valuation to verify the projected outcome of this important project for Jersey.

“I hope the findings of this valuation will reassure islanders that the scheme remains financially viable in the light of recent contamination concerns.

“We are developing this finance centre, through a phased approach, for the benefit of islanders.

“We need to maintain a thriving economy that can fund all the services we need – health, education, essential infrastructure – and to do that we need to provide the facilities that existing and new businesses demand.”

Construction work – by local firm Camerons – has started on the first of the six buildings, with Planning permission already in the bag and the tenants eager to move in. UBS, who have been in Jersey for more than 30 years, employ around 200 staff in the Island, and are expected to take two floors of the building.

The six-block financial services centre with around 470,000 sq foot of office space – or around six-times the size of the football pitch at Wembley Stadium – was first given the green-light by politicians in 2008.

Since then various dates about work starting have come and gone, and the project has also shrunk, with plans to lower the road running from the underpass and build on top of it delayed.

The original completion date given to the States was between 2015 and 2018.

In April last year, it was announced that RBC – the main tenant that office developers have been looking to secure – had chosen to move to a new Dandara building on the Esplanade, not to the States’ Waterfront office scheme.