Network Rail has given its specialist transport property business, Network Rail Property, greater independence by establishing it as a property company with its own board which will approve investments in Network Rail’s estate and make decisions about the disposal of property assets.
The new structure and governance arrangement will enable Network Rail to ramp up its property activities to help generate £1.8bn to fund the Railway Upgrade Plan by disposing of various assets. It will also provide greater focus on plans to deliver land for housing, while continuing to generate income from Network Rail’s other property assets to reinvest into the railway.
The creation of a property company with its own board will mean that Network Rail can focus on its core business of running a safe, reliable and growing railway while the property board can be given a clear mandate to accelerate the release of value from the property portfolio.
This new and significantly enhanced organisation went live on 1 April 2016 and is led by David Biggs in his role as managing director of Network Rail Property. The new board will be chaired by Chris Gibb, a non-executive director of Network Rail since 2013, who has worked in the rail industry for more than 35 years.
A search has begun to identify two further non-executive directors with significant experience in the commercial and residential property market and in leading complex property disposal and acquisition transactions.
David Biggs, managing director of Network Rail Property, said: “A bigger and better railway requires significant investment and Network Rail is generating an extra £1.8bn to help fund the Railway Upgrade Plan, mostly through the sale of property assets where continued Network Rail ownership is not essential to running the railway. This means Network Rail can focus on its core business of running a safe, reliable and growing railway that is vital to Britain’s economic health.
“Our new property company will have greater powers to unlock land for homes, drive economic growth in towns and cities and reinvest money into the rail network to help fund the Railway Upgrade Plan. It will mean that investment or asset disposal decisions can be made at the right level within the organisation in a timely way while ensuring appropriate oversight is in place.”
This decision follows earlier announcements that Network Rail will generate an extra £1.8bn to help fund the Railway Upgrade Plan. The majority of this money is expected to come from the sale of property assets where continued Network Rail ownership is not essential to running the railway, allowing Network Rail to focus on its core business of running a safe, reliable and growing railway.