Serviced Office Group Follows Strategies to Stabilize Financial Status

"The Chairman of the group, Michael Kingshott has said that 2010 will be an eventful year as activities will be streamlined and initiatives will be undertaken to bring the office rental company to a firm footing cash wise."

The piece about Serviced Office Group below originally appeared as a blog entry on the Rare Pal site.

Officing Today's Finance Editor Jonathan Price comments, "There are some hints in this article about Kingshott that Serviced Office Group needed the cash from the recent deals."

From Rare Pal:
"The top management of the Serviced Office Group have agreed on certain business strategies which are aimed at stabilising the company's financial status in the year 2010. The Chairman of the group, Michael Kingshott has said that 2010 will be an eventful year as activities will be streamlined and initiatives will be undertaken to bring the office rental company to a firm footing cash wise.

"The Serviced Office Group has recently completed renewing their £26m loan with the Royal Bank of Scotland. After renegotiation the new payback date will be 2012. To help pay back some of its debt, the company is looking at undertaking leaseback proposals as well as selling some of its assets. These will improve the group's loan to value (LTV) ratio as well as curtail the outflow of funds in the form of interest payments. Last valuation showed the total assets of the 
company at £28m. This also included the 2.3m Teddington property which is part of the group's portfolio.

"An option for absorbing up to 50% of any gains arising in planning has also been accepted by the company. This gain will be applicable only on assets for which purchase price is over £2.5m. However any leaseback deals or sales could negate the effects of such an agreement with respect to that specific property. According to company sources, once these programmes are in place, the company's fortunes could begin to lookup as interest costs begin to fall."