Network Rail is to sell off its £1.46bn commercial property portfolio to an Anglo-US consortium in a deal with significant interest for commuters and other rail travellers.
The much-criticised railway infrastructure owner says it plans to use the cash, from US giant Blackstone and Britain’s Telereal Trillium, to upgrade services across the country after coming under severe pressure for its day-to-day running of operations from the UK rail watchdog.
But one group of people more anxious about the sale are the tenants of the arches which make up the bulk of the portfolio, who fear they may be hit with steep rent rises.
However, Network Rail chair Sir Peter Hendy said it would be a good deal for both groups.
“This deal is great news – for tenants it will mean significant commitment and investment, and for passengers and taxpayers it will mean massive, essential improvements without an extra burden on the public purse,” he said.
More than 5,200 properties will be acquired in the joint buyout from US investment giant Blackstone and Telereal Trillium, which is owned by the secretive billionaire brothers Mark, Trevor and David Pears.
The acquisition follows several months of speculation, in which a number of private equity firms, including Guy Hands’ buyout group Terra Firm, battled it out to be the top bidder from the rail property arm.