McLaren To Sell Iconic Woking Headquarters for £170 Million

McLaren is set to sell famous headquarters at Woking for £170 million but will lease back premises on a 20 year contract.

Real Estate Investment group Global Net Lease has confirmed it is acquiring McLaren’s iconic headquarters in a deal valued at £170 million ($237 million) and sales terms allowing McLaren to lease back the premises for the next 20 years.

Consisting of the McLaren Technology Center, the McLaren Production Center, and the McLaren Thought Leadership Centre, the futuristic headquarters based in Woking, England, covers 840,000 square feet and is home to over 1000 workers across McLaren’s Automotive, Racing and Applied Technologies divisions.

“We are excited to announce that this world-class facility will become part of the GNL portfolio,” said James Nelson, CEO of GNL. “The McLaren Group Headquarters’ state of the art buildings have won numerous awards, were designed by renowned architect Norman Foster, and are the type of mission-critical, net-leased properties that make up the GNL portfolio. We are very pleased to have been able to collaborate and work with the management team of the McLaren Group to effect this transaction. We look forward to the long-term partnership with McLaren and the benefits this transaction will have to GNL. The acquisition exemplifies GNL’s ability to source large scale and accretive sale-leaseback opportunities in a competitive marketplace that add significant value to our overall portfolio. We believe our global presence as a leading net lease REIT will continue to provide attractive acquisition opportunities that complement our best-in-class portfolio.”

Having been on the market since last year, McLaren has been keen to find a buyer to sure up cash flow at the convergence of multiple events, including the impact of COVID-19 on business operations and the final installment payout of the £275 million buyout of Ron Dennis’s share of McLaren.

“Why have all this money tied up in real estate? We’re not a real estate company. We’re a racing team and an automotive company. And that’s the start of the journey to start cleaning up the balance sheet [at McLaren],” McLaren’s chief executive Zak Brown shared in 2020. “I think the majority of companies in this world don’t actually own the real estate that they are tenants of. We’ve got a lot of cash tied up in that building, as you can imagine, and that’s not a very productive use of funds when you’re looking to invest in your business.

“So we’ll ultimately sell it to someone. We will then do an extremely long-term lease, and then we’ll use that money to invest in our business to help us grow our business. So it’s a pretty typical financial restructuring exercise.”

The deal, which is expected to be finalized in the second half of 2021, still falls short of the initial £200 million McLaren was hoping to achieve with the sale but will ensure the cash injection gives the autogroup breathing room to continue operations.