Creating long-term value

The resolution to grant planning approval for the Group’s housing development on land adjacent to Cambridge Airport was forthcoming late last week. This is another pivotal step in its growth strategy, and we believe the property projects will prove to be transformative to the Group’s EBIT and cash flow over the next decade.

Marshall Group Properties (MGP), a subsidiary of the Group, owns approximately 900 acres of land that comprises both Cambridge Airport and areas adjacent to it. The airport itself is less than two miles east of the city centre and nearby Marshall has two major development projects. Marleigh lies to the north and Land North of Cherry Hinton (LNCH) to the south. MGP is to develop approximately 230 acres of its land across the two sites.

Phase One of the Marleigh development is already underway, with detailed planning permission granted in August 2019 for 239 dwellings, with initial home reservations secured during Q1 2020. The entire LNCH site comprises 138 acres, with 70 supplied by MGP.

The development of the two parcels of land will transform the finances of the Marshall Group over the next decade. We expect that significant cash flow should begin to pass back into the Group from 2025 onwards, thereby enabling management to further invest in the core Marshall Aerospace & Defence Group (MADG).

In the meantime, we retain our fair value of 532p per NVPO share.