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Drum Property Group beats a path to bigger profits

McLeod + Aitken also worked on Prime Four at Kingswells, Aberdeen.
McLeod + Aitken also worked on Prime Four at Kingswells, Aberdeen.

Drum Property Group, the Aberdeen-based property developer and investor behind the Prime Four business park at Kingswells, nearly doubled its profits in 2014.

The pre-tax figure soared to just over £1millon, from £540,640 the year before.

Turnover also increased substantially last year to £2.77million, from £1.56million the year before.

But finance director Stuart Oag said the firm’s accounts – released by Companies House yesterday – reflected only a “fraction” of the success of a portfolio of Drum investments turning over more than £100million a year.

“Drum Property Group is just a small part of our activities,” he said, adding that Drum’s wider business interests were prospering as a result of economic growth.

He said: “The regional economies in which we are developing, from Inverness to Glasgow and further south, are performing reasonably well.

“GDP (gross domestic prodict) is improving and … we are seeing wage inflation outstrip inflation.”

Mr Oag said growing consumer confidence was driving demand for new retail developments in many parts of the UK.

Drum aims to capitalise on this by looking for opportunities well beyond its home city, where the market is rather more challenging just now because of the oil and gas industry downturn.

But Mr Oag said there were still “excellent” development opportunities in Aberdeen and Drum was still pressing on with plans for a fourth phase of Prime Four.

A “wellness centre” – to include consulting, diagnostics and treatment rooms – is proposed in this latest stage of development.

Prime Four tenants either already on site or preparing to move in include North Sea oil companies Statoil, Apache, Nexen and Premier Oil, drilling contractor Transocean, Cameron and Schlumberger joint-venure OneSubsea, accountancy firm Anderson Anderson Brown and the 148-room Urban Village Resort.

On completion, the £500million business park will provide in excess of 1.5million sq ft of office space and be home to several thousand workers.

Earlier this week, Drum said its fledgling real estate investment trust (Reit) had completed two major UK acquisitions and exchanged contracts on a third, with a combined value of £20million.

The Reit, launched on the London Stock Exchange earlier this year, targets commercial property opportunities across the UK.

Its first two acquisitions were the £4.5million purchase of Duloch Park retail park in Dunfermline and a £2.67million deal for the Mayflower House office complex in Gateshead.

Contracts have also been exchanged for the acquisition of Gosforth Shopping Centre in a deal worth £12.25million.