Hermes sells three business parks to build tech estates

“We want to redirect the capital into more innovative investments,” said Mr Taylor. “In terms of sustaining rental growth in the long-term, we want to make sure we are aligned with growth sectors of the economy.”

He added: “As investors we are trying to anticipate future tenant demand, rather than sit and collect rent from relatively mature assets.”

Mr Taylor said the sale of the business parks marked the biggest shake-up of the MEPC portfolio for 20 years. As well as Silverstone Park, Mr Taylor said part of the proceeds from the sale will be used to boost a biotech cluster at MEPC’s Milton Park near Oxford, and a new business estate at Wellington Place in the centre of Leeds.

Mr Taylor said there was already “strong demand” for companies to move to Milton Park to be in the bio-tech cluster around Oxford University.

The park is also well placed to benefit from MedCity, the biotech triangle between Oxford, Cambridge and London that Boris Johnson launched last month. The Mayor of London said the region could complete with the giant US bio-tech hubs such as Boston and San Francisco.

The Leeds development is a clear sign that Hermes, which is one of Britain’s biggest property companies, is backing the prospects of regional property prices, not just London.

Mr Taylor said Hermes and MEPC was using the deal to “call the recovery”. He said: “We think the timing is right now. As a generalisation, nothing much has been built outside London in this space for six or seven years, since the crash. We are now seeing demand improve in Birmingham, Manchester, Leeds. So part of the capital will go to kick-start new developments in Leeds.” He said MEPC would also be looking to build new business park or buy and revive other ones that are struggling.

He said the shake-up of MEPC was “a big call”. But he added: “MEPC has the advantage of being close to the occupier. So this is all being led by occupier demand and we are confident.”

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