Monday, April 12, 2021
Real EstateUK

FirstGroup agrees property disposals from Greyhound division

FirstGroup

It includes the sale of Greyhound’s customer terminal facility to a subsidiary of Prologis

Transport giant FirstGroup has agreed three property disposals in Los Angeles, Colarado and Ontario, it said on Thursday.

FirstGroup said the disposals, for total gross proceeds of $137 million (£102 million),  are part of its programme to rationalise its coach line Greyhound’s property portfolio.

FirstGroup, which runs the GWR trains out of Paddington to Wales and the West Country, said the largest part of the sale is Greyhound’s legacy garage and customer terminal facility in the downtown arts district of Los Angeles, to a subsidiary of logistics real estate business Prologis.

Greyhound will lease back the site from Prologis for two years, during which time it will complete the moves of its terminal to a more convenient location for customers and of its garage operations to a more appropriately-sized site elsewhere.

The other two property disposals announced today are of sites in Denver, Colorado, and in Ottawa, Ontario.

The customer terminal in downtown Denver has moved elsewhere. Activities at the Ottawa garage were relocated as part of Greyhound’s withdrawal of service from parts of Canada in 2018/19.

FirstGroup said: In total, all three properties’ book value was $24m as at 30 September 2020, resulting in a total profit on sale for all three transactions of approximately $100m (net of leaseback, property tax and selling costs). The cash proceeds from the transactions will be used for general corporate purposes.

It said that these transactions are a further step in the group’s rationalisation of the Greyhound property portfolio for value, reducing the operational footprint by moving operations to intermodal transport hubs or new facilities better tailored to customers’ needs.

A number of other property sales processes are also underway.

FirstGroup, which has seen UK passenger numbers hit this year due to Covid-19 disruption, is looking to sell the Greyhound business.

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