British Land to buy Microsoft HQ

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The Independent Online
BRITISH LAND, the acquisitive property group, is poised to buy Microsoft's UK headquarters in Reading in a high-profile deal worth around pounds 100m.

The US software giant is believed to be close to a sale-and-leaseback deal on its 33-acre "Microsoft Campus" with a joint venture between British Land, the UK's second largest property company, and the American pension fund Teachers.

Under the agreement, Bill Gates' company would sell the site on Thames Valley Park to the British Land/Teachers consortium and would pay a yearly rent to the property company and its partner. The arrangement will enable Microsoft to remain on its flagship site while reducing the property costs of its headquarters.

According to today's Estates Gazette, a trade magazine, the US computer company had been eyeing a sale-and-leaseback deal since September as part of a review of its UK properties. Microsoft, British Land and Teachers declined to comment.

The search for a real estate partner is in line with Microsoft's group- wide policy of owning very few property assets to keep fixed costs to a minimum.

Sources close to the company said that the US giant has sale and leaseback arrangements on the majority of its headquarters around the world.

The Thames Valley Park is the key hub for the Microsoft's UK operations. It houses around 1,000 sales and marketing staff in three buildings totalling over 20,000 square metres.

The company, which moved to the site last year, has planning permission for a further 25,000 square metres of new buildings.

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