Funding for payout
Glasgow secures £285m from L&G for pay settlement
Susan Aitken: ‘we can start to put right a historic wrong’ (pic: Terry Murden)
Glasgow City Council has secured a £285 million deal with Legal & General to support its recently settled equal pay liability.
It is estimated that around 12,000 Glasgow city households will benefit from the settlement of the dispute which will be met through security on 473 commercial assets located around the city.
The portfolio includes a range of ground rents, office assets and industrial estates, as well as strategic assets. These include two historic landmarks, the SEC Armadillo and City Halls, which have been retained by Glasgow City Council for the benefit of the community.
LGIM Real Assets (Legal & General) said the investment provides an “excellent match for Legal & General’s long term annuity and pension commitments, and marks another significant investment in Glasgow”.
In the last year, Legal & General has made a number of investments in the city. These include its 324 home Build to Rent scheme at Buchanan Wharf, the development of 160 room hotel opposite Queen Street Station, the acquisition of the Scottish court and tribunal building and the forward funding of the Atlantic Square Development to provide a major new UK Government hub.
“This long term financing demonstrates the positive impact that a proactive local authority and long-term debt investment can provide,” said the company.
Through the partnership, GCC has been able to deliver on its promise to resolve the equal pay dispute whilst also protecting its property assets, many of which have been in council ownership since the mid-1900s.
Lorna Brown, head of real estate debt at LGIM Real Assets, said: “Legal & General is pleased to support Glasgow City Council in addressing their historic pay issues through the provision of the majority of the capital required to meet this liability. This is a strong long-term partnership for our real estate debt team alongside City Properties Glasgow (Investments) and Glasgow City Council and is an excellent fit for our pension fund capital.”
Pete Gladwell, head of public sector partnerships at LGIM Real Assets, said: “This provision of funding demonstrates our commitment to investing in UK regions, and a partnership between a forward thinking institution and local authorities.”
Council leader Susan Aitken said: “Settling Glasgow’s equal pay dispute and delivering pay justice for our women workers is a hugely significant step forward for the council and the city as a whole.
“This deal not only means we can start to put right a historic wrong, but do so while safeguarding the future of the city’s property assets in public use. I’m very pleased to be doing that in partnership with Legal & General, which continues to show great confidence in Glasgow as a place to invest.”