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Zero Debt Leaves Sugar In Good Spot To Ride Out Pandemic

Lady Ann Sugar and Lord Alan Sugar

Lord Alan Sugar’s property empire is well-positioned to see out the current crisis because it has no debt secured against it, accounts for his private property vehicle revealed.

The Apprentice star was in the news this week after he sold the Lever Building in Clerkenwell to the Merseyside Pension Fund for £39M. The 30K SF building is leased to Tesco’s digital arm at a rent of £57 per SF.

Accounts for Amshold, Sugar’s property investment vehicle, indicate the prudence with which the business is run.

The company did not pay a dividend in the year to June 2020, to preserve cash to help it weather the downturn. In 2019 it paid Sugar and his wife a £75M dividend, and in 2017 the dividend was £181M. 

The company’s net asset value dropped slightly, from £468M to £467M, but rises in cash on hand offset a £14M drop in the value of the portfolio, which is concentrated in central London. 

The accounts said the coronavirus could impact the value of the portfolio, but the fact that it has no debt means there is no external pressure from lenders to meet covenant tests or make interest payments. 

The company made an operating profit of £15M from revenue of £21M, with the bulk of the profit coming from rental income. 

Sugar has focused on smaller office and retail properties in London and the south of England. It sometimes undertakes development, and in 2018, it sold the Crosspoint building in the City of London to Carlyle for £43M. 

Related Topics: Tesco, Alan Sugar, Amshold