Southampton City Council is looking to underpin its financial security by investing in profitable property in a bid to reduce the financial impact of ongoing budget cuts.
Investing in commercial property will offer the council an independent stream of income that will help it become more self-sufficient moving forward.
The council has already secured three properties with combined deals worth £20.1m and is looking to step up its activity.
These investments include two retail warehouse properties in Southampton on Winchester Road occupied by Wickes and Halfords and an office building in Cambridge with Nokia and Virgin Media Ltd already in-situ as long-term tenants.
Southampton City Council leader, cllr Simon Letts, said: “Borrowing rates are currently low which means the council can use fixed interest loans to strengthen our property investment portfolio.
“We’re investing money in long term commercial investments such as the freehold of the Cambridge and Southampton based properties.
“The money we receive in rent adequately covers the money we are borrowing, which also provides a profit which we will use to support some council services.
“It is essential in these austere times that we invest public money prudently and it makes good business sense for us to look for new ways to generate much needed income for the council.”
Plans for further property investments are already being considered with more deals expected to be completed in the coming months.