Slough Estates

Slough Estates Plc is Britain's largest industrial property investment company, with a property portfolio valued at about £2 billion. The development and management of Industrial Estates (or Trading Estates), sites containing units of industrial property occupied by several different companies, was pioneered by Slough in the 1920s and still forms the bulk of its business, both in the United Kingdom and overseas. In the 90s the company diversified into other property and non-property activities.

History

Slough Estates began life in 1920, when a syndicate of businessmen formed the Slough Trading Company to purchase a 600-acre site in Slough which was formerly a repair depot during World War I. War industries, and the aftermath and disposal of war materials formed the basis of the company. The government's original intention was to repair and sell the assembled vehicles following the war, but after publication of the report of a parliamentary joint select committee in July 1919, it was decided to sell the site to a private buyer. The site was sold for £7 million, a price which included thousands of disused war vehicles, many of which were still on the continent. Prominent among the syndicate of businessmen who bought the site were Sir (later Lord) Percival Perry, the founder of Aims of Industry and the managing director of the U.K. branch of the Ford Motor Company, and Noel Mobbs (later Sir), founder of the Slough Trading Company as well as chairman of the Pytchley Autocar Company Ltd. which he had founded in 1904.

Nearly half the population of Slough were employed in repairing and selling the vehicles which were sold at auction, and by the end of 1920 more than £5 million had been raised. To speed up the disposal of the vehicles the company employed what was then an innovative labor-management policy; the work force was paid regular wages rather than piece rates and a 40-hour, five-day week was introduced, without any reduction in earnings despite the reduction of 10% to 20% in working hours. This policy proved successful, resulting in the productivity improvements that it was designed to achieve.

By 1925 the company started building fully serviced factories on the site, augmenting what had already been built by the company for vehicle repair operations, together with utilities, including a power station. The establishment of an integrated industrial estate of the type envisaged by the company's founder, Sir Noel Mobbs, involved further infrastructure provision. Utilities were extended and other services were organized; both Barclays Bank and the National Provincial Bank (later the NatWest) established themselves on the site to serve the new factories.

Early tenants included Citroen Cars, Johnson & Johnson, Gillette, The Mentholatum Company, and the Hygienic Ice Company. The site at Slough was ideal for such consumer goods industries, with good road and rail links to London, which was only 20 miles away, and the Midlands. Slough's first chairman, Sir Percival Perry, was succeeded by Sir Noel Mobbs in 1922, and who was to remain chairman for the next 35 years. The passage of the Slough Trading Company Act 1925 permitted the company to build roads and lay water and steam mains, electricity cables, and drains. This facilitated large-scale industrial development on the site.

Within a few years the company transformed itself into a property company, Slough Estates Ltd. in 1926. A policy was developed in these early years whereby Units were offered for rental rather than sale, giving Slough Estates control over the estate and a continual source of revenue. Only light industry was to operate on the estate.

Sir Noel Mobbs envisaged the estate at Slough as an integrated industrial community. In addition to the provision of utilities and infrastructure on the site, he planned a variety of social and welfare services for the estate which would encourage a community atmosphere. His plans culminated in the establishment of the Slough Community Centre in 1937, and the Slough Industrial Health Service, launched in 1947 after delays caused by World War ll. The estate easily survived the 1930s, its variety of trades and concentration on the new light industries shielding it from the severe depression which hit Britain's older core industries. Slough claimed to have the lowest unemployment rate in the country, at 1 %, and the estate was able to absorb unemployed workers from outside the area. The growth of Slough was closely linked with the fortunes of Slough Estates.

During the postwar reconstruction period, expansion was inhibited by shortages and government restrictions. Development at Slough in the early postwar years was restricted to expanding factory space for existing tenants. In order to overcome these problems, Slough Estates sought further expansion outside Slough. During this time of tight government controls, undertaking government-sponsored projects provided one means of gaining the necessary official approval. Slough participated in such a scheme in 1945, developing an estate in Swansea at the request of the Board of Trade. Just as Slough Estates's formation had resulted from government activity during World War I, demobilization following World War II brought new opportunities. In 1948 it obtained a 22-acre site at Greenford, Middlesex, which had been used as an ordnance depot, with 21 units let to the War Department.

Sir Noel Mobbs retired as chairman in 1957, and was succeeded by Lieutenant Colonel W.H. Kingsmill, with Gerald Mobbs as managing director.

1960s - Into Europe

During the 1960s, influenced by the growing prosperity of the European Economic Community (EEC), Slough decided to expand into Europe. Growth was assisted by the takeover of another company specializing in industrial property, Hertford Industrial Estates, which was acquired in 1969 for £830,000. Slough was the first British property company to tackle the industrial sector in the United States.

During 1976 Sir Nigel Mobbs, grandson of Sir Noel Mobbs, became chairman and chief executive succeeding his father Gerald Mobbs. The early 19808 saw steady growth in Slough's profits, despite a depression in industrial property, as rent reviews led to increased rental income. Slough undertook a number of developments both at home and overseas. U.S. activities were expanded substantially, developments being concentrated around the Chicago area. In 1984 Slough merged with Allnatt London & Guildhall Properties, with assets valued at £159 million. Allnatt's properties were well suited to Slough's portfolio, since they were predominantly industrial. During 1987 it was decided to broaden the company's asset base, with increased activity in the shop, office, and retail warehousing markets. Until 1987, only 8.5% of Slough Estates's U.K. portfolio was in non-industrial property, though its commitment to other property areas increased sharply in 1986 with the purchase of a 52 % stake in Bredero Properties, a development company that specialized in U.K. shopping malls.

Carrying on the connection with the military its portfolio includes a large section of Farnborough airfield, former headquarters of Britain's Royal Air Force; Slough Estates plans to develop office space and research facilities on the site.

Board of Directors

• Nigel Rich CBE - Chairman: A fellow of the Institute of Chartered Accountants, former Chairman of Exel, a leading provider of contract logistics services in the US and Canada, until its takeover by Deutsche Post in December 2005. He is currently a non-executive director of Pacific Assets Trust and KGR Absolute Return PCC. His executive directorships have included Finance Director and Managing Director of Hongkong Land (1983 to 1988), Managing Director of Jardine Matheson (1989 to 1994) and Chief Executive Officer of Trafalgar House (1994 to 1996). His chairmanships have also included CP Ships and Hamptons Group. He is Deputy Chairman of Asia House, a charitable organisation that promotes Asian culture in the UK. He was appointed a director of Slough Estates in July 2006.
• Ian Coull - Chief Executive: A Fellow of the Royal Institution of Chartered Surveyors, he joined Slough Estates from J Sainsbury plc where he was director responsible for Real Estate. Before joining Sainsbury’s in 1987 he held Board and Senior Management positions at Ladbrokes, Texas Homecare and Cavenham Foods. He is on the London Regional Board of Royal and Sun Alliance . He was President of the British Property Federation (BPF) until July 2006 and now chairs the BPF’s REITS task force. He has been a director of Slough Estates since January 2003.
• John Heawood - Executive Director: After six years with Fletcher King and 11 years with DTZ Debenham Thorpe, dealing with provincial industrial and office property, he joined the Board of Slough Estates in November 1996.
• Walter Hens - Executive Director: Responsible for the Company’s operations in Continental Europe. He is a Fellow of the Royal Institute of Chartered Surveyors and a graduate of the University of Antwerp, Belgium. After nine years with Imofo (now Banimmo), a developer and investor in Belgium, he joined Slough Estates in 1989 and was responsible for the Belgian operations until 2004. He is a senior figure in the Belgian property market and a non-executive director of Intervest Offices, a Belgian REIT. He joined the Board of Slough Estates in January 2007.
• Marshall Lees - Executive Director: Responsible for operations in North America. He is a graduate of the University of Western Ontario and York University, Toronto. Following three years with British American Tobacco, he obtained an MBA at the London Business School and subsequently joined Imperial Group plc. He joined Slough Estates in 1987 and was appointed a director in March 1998. He is a director of the Charterhouse Group International, Inc.
• David Sleath - Finance Director: A Fellow of the Institute of Chartered Accountants, he joined Slough Estates from Wagon plc, where he had spent five years as Finance Director. He trained at Arthur Andersen, becoming a partner in 1992 and Head of Audit and Assurance for the Midland Region in 1995. He joined Slough Estates as Deputy Finance Director in April 2005 and joined the Board as Group Finance Director on 1 January 2006.
• Lord Norman Blackwell - Senior Independent Non-Executive Director: Amongst other business interests, he is Chairman of Interserve plc, a non-executive director of Standard Life, The Corporate Services Group plc and Smartstream Technologies Ltd and is a senior adviser to KPMG’s Corporate Finance practice. He also serves as a non executive Board Member of the Office of Fair Trading. After many years as a partner with McKinsey & Company, he served as Head of the Prime Minister’s Policy Unit from 1995-97, and was Director of Group Development at NatWest Group from 1997-2000. He became a Life Peer in 1997 and is currently Chairman of the Centre for Policy Studies. He was appointed a director of Slough Estates in April 2001.
• Stephen L Howard - Non-Executive Director and Chairman of Remuneration Committee. He began his career as an attorney in his native US with a focus on corporate advisory work for multinational companies. He went on to become Group Chief Executive of Cookson Group plc and then Novar plc. He is on the advisory councils of various private and non-profit organisations and is the Managing Director of Business in the Community. He was appointed a director of Slough Estates in May 2001.
• Lesley MacDonagh - Non-Executive Director: She joined Lovells in 1971, became a partner in 1981 and Head of Property, Planning and Environmental Practices in 1987. From 1995 to 2005 she was Worldwide Managing Partner and was made a Director of Lovells in 2006, overseeing Legal & Skills Training, Partnership Planning, Lateral Hiring and International Premises and Facilities. Since 2003 she has been a non-executive director at the Bovis Homes Group. Until recently she was a Governor of the London School of Economics, a member of the Property Advisory Group for the UK Government and a Council Member of the Law Society - where she was also a Member of both the Property Advisory and the Planning & Environmental Law Committees. She joined the Board of Slough Estates in January 2007.
• Andrew Palmer - Non-Executive Director: A chartered accountant, he is currently Group Finance Director with Legal & General Plc. Since joining Legal & General in 1988 he has held a number of financial and operational roles in the asset management, insurance and international businesses. He was appointed a director of Slough Estates in January 2004.
• Christopher Peacock - Non-Executive Director: A Fellow of the Royal Institution of Chartered Surveyors, he was President and Chief Executive Officer of Jones Lang LaSalle until the beginning of 2004. He joined Jones Lang Wootton in 1972 and was made a partner in 1974. He became the European Chief Executive in 1996 and Jones Lang Wootton’s first global Chief Executive in 1997. In 1999 he became Chief Operating Officer and subsequently CEO of the NYSE listed company. He was appointed a director of Slough Estates in January 2004.
• Thom Wernink - Non-Executive Director: A Dutch citizen and a senior figure in the Continental Europe property market. He was until April 2005 Chairman of the European Public Real Estate Association and was a former Chairman of Corio NV, a Netherlands-based property company which had retail, office and industrial interests across Europe, the US and Canada. He is a non-executive director on a number of Continental European-based property and investment companies. He was appointed a director of Slough Estates in May 2005.

Key Dates

1920: Slough Trading Company is founded by Noel Mobbs to acquire a 600-acre site on Bath Road in Slough, England.

1925: The Slough Trading Company Act is passed.

1926: Slough Estates Ltd. is created.

1931: Slough Estates acquires a 55-acre site near Birmingham, England.

1937: The Slough Community Centre is founded.

1945: Slough develops an estate in Swansea at the request of the U.K. Board of Trade.

1947: Slough Industrial Health Service is founded.

1948: The company obtains a 22-acre site at Greenford, Middlesex.

1950: The company develops its first investment property in Ajax, Canada, near Toronto.

1957: Lieutenant Colonel W.H. Kingsmill succeeds Sir Noel Mobbs as chairman; and Gerald Mobbs, son of Sir Noel Mobbs, becomes MD.

1961: Slough Estates Australia Pty. Ltd. is established after purchasing 1,500 acres at Altona, near Melbourne.

1967: The company purchases an industrial estate in Wakefield, to the north of England.

1969: Slough Estates ccquires Hertford Industrial Estates and Yorkshire and Pacific Securities Ltd., a U.K.-based investment company.

1972: Gauntlet Developments is formed to develop offices in the United Kingdom and Europe.

1974: Slough Estates enters into a joint venture with Draper & Kramer of Chicago to form SDK Parks.

1976: Sir Nigel Mobbs, grandson of Slough founder Sir Noel Mobbs, becomes chairman and chief executive.

1984: Slough Estates merges with Allnatt London & Guildhall Properties.

1986: Slough Estates acquires equity interest in Tipperary Corporation of Denver, Colorado.

1998: The company begins development of Pegasus Business Park in Brussels, the site of a European center for the U.S. company Cisco Systems.

1999: Farnborough Business Park, the former Royal Aircraft Establishment is acquired.

2000: Cambridge Research Park development site is acquired; the city of South San Francisco, grants Slough Estates consent to develop offices and R&D space at Oyster Point; and work commences on the Willingdon Park development outside Vancouver, Canada.

2001: Slough's Canada portfolio in Toronto is sold.