Further long-term value creation

Planning approval has been granted for the second phase of the Marleigh development, comprising 421 homes approximately 2 miles east of the centre of Cambridge. This represents a further step in unlocking value from the Group’s portfolio and we believe the property projects will prove transformative to Group EBIT and cash flow over the next decade.

This approval at Marleigh was for homes on land adjacent to phase 1,  including 333 one-to-two bed apartments and 88 two-to-four bed houses, that will be suited to first-time buyers and families. 30% of the second phase will consist of affordable housing, via shared ownership or affordable rent. Construction of phase 2 will commence in Q1 2022, with occupation from Q2 2023 onwards.

In addition, the local authorities (comprising Cambridge City and South Cambridge) published a first draft of the Preferred Options Local Plan, which sets out its favoured development strategy for the city from 2030 to 2050. Cambridge East remains central to those plans, which incorporates land owned by Marshall.

With no change to our estimates because of this news, we have retained our fair value at 611p per NVPO share. The most recent traded share price of 257p stands at a discount of 58% to our fair value assumption.