Geoff Hunton, director, Merchant Place Developments

GEOFF Hunton finds himself in the limelight following his coup in bringing Hitachi to the North East.

Geoff Hunton, director, Merchant Place Developments

GEOFF Hunton looks tired which is perfectly understandable, given that he has recently pulled off the biggest coup of his career.

Over the summer it was announced that Hitachi and its partners had reached final agreement with the Government for the Japanese manufacturing giant to replace ageing Intercity trains.

This means it will build a 450,000sqft manufacturing and assembly plant at Merchant Place Development’s site at Amazon Park, Newton Aycliffe, which will employ up to 730 people.

“From my point of view it’s probably one of the biggest achievements of my career,” says Hunton.

The deal took some five years to bring to fruition so Hunton, 66, can be forgiven an air of weariness when we meet in a Merchant Place Development’s modest offices in Wideopen.

As he moves round his desk he contrives to dislodge a large cardboard placard from the wall and then tread on a teleconference phone unaccountably placed on the floor. He is a big man but should be nimble given that he practised judo for 22 years, gaining his black belt, but the high-impact sport has ravaged his knees, for which he is imminently due to go into hospital.

He was hardly destined for multimillion pound property deals, having been born into a farming family and raised in York. He retains his Yorkshire accent.

Farming held no appeal for him. He says: “I suppose I was the black sheep of the family, I was the only one who didn’t go into farming.

“I never did O-levels or A-levels. In the 1960s I was a product of comprehensive education and I went through ONCs and HNDs and then went to Reading University to study surveying, so I suppose you could say I came the long way round. I was a late developer academically.” Initially he trained as an architect in York but was made redundant before qualifying. He got a job with the Government’s Property Services Agency (PSA), qualified as a Chartered Surveyor and was transferred to Newcastle for what was supposed to be two years. And, apart from three years on Gibraltar, he has been here ever since.

“Working for the PSA in Newcastle was a fantastic experience because I was looking after all sorts of properties,” he says.

In 1991 he left the PSA for the private sector, joining the Newcastle office of construction and property consultants Summers Inman.

He retired from the firm as an equity partner in 2006 and, with the firm’s agreement, set up Development Monitoring Services LLP and then, in partnership with a London-based partner, set up Merchant Place Developments, as a sister company to Merchant Place Corporate Finance.

“My 40 years’ experience in the construction industry and doing due diligence for banks was seen by my partner as a good fit to allow us to do development work,” says Hunton.

Wasn’t it a gamble?

“It was a risk, everything’s a risk, life’s a risk,” he says. “Not as big a risk as it turned out. We set Merchant Place Developments up in late 2006 and within a year everything had gone crazy.”

He adds: “Merchant Place Developments was aimed at doing small development work and our first development was a £23m headquarters building for Avon Cosmetics in Southampton.” The firm went on to do further developments such as the Tronic headquarter in Ulverston. Generally, Merchant Place is approached with proposals for partnership in development work and does not build speculatively, although the acquisition of 1.5 million sqft at Amazon Park in partnership with Durham County Council was an exception.

“But don’t forget, that was 2007 when everything was rosy,” says Hunton. “What attracted us to it was its relationship to the A1(M), its relationship to rail and the ports. It was an ideally suited site for development.”

Merchant Place had planning permission for warehousing and expected something like a big supermarket chain to express an interest. But, as events were all too quickly to demonstrate, that was not a good time to be making investments.

Happily they then received an inquiry from an agent on behalf of an unnamed client for 350,000sqft site with an adjacent railway line.

It emerged that the client was Hitachi seeking a site for its train plant and Amazon became one of 42 possible locations the manufacturer was looking at.

“By the end of 2009 we were aware it was down to four sites and then it was between ourselves and a site in North Wales.”

That meant serious competition for Amazon as the North Wales site could rely upon the support of the Welsh government in Cardiff with its considerable resources. However, Hunton pays tribute to the support his bid was given.

“We got tremendous support from Durham County Council in relation to the site and also from Phil Wilson, MP for Sedgefield. Politically the thing went quiet between March 2010 and early 2011 but within that time, Phil Wilson was pushing it. So, between ourselves and Phil and Durham County Council we achieved our objective.”

One of the things that clinched the deal was a site visit by a team from Hitachi.

“We knew they had been to look at a site in Leeds, which had buildings on the site. We had no buildings – it was just green fields – so what we did was set out the layout of the Hitachi proposed plans with white tape and we hired a helicopter and took the Japanese team up into the air so they could see where the infrastructure was, where the railway line was and the site’s potential. I think that’s what clinched it for us.”

In March 2010 Amazon was identified as Hitachi’s preferred site.

How did he feel about that?

“Delighted, but we knew there were still hurdles to go through because they still hadn’t signed their contract with the Government and until that was signed nothing was certain.”

Then came a general election and a new Government and the project was put on hold. A review was completed in October of that year but it was the following year before the deal was confirmed.

“It’s been a roller coaster,” says Hunton. “There were highs and lows and we went through some real lows when there was a change in Government and we wondered whether the project was ever going to go ahead after we’d put all that effort in.”

Having reached a successful conclusion, he felt immense relief but then considerable pride at what Merchant Place had achieved.

“We did a presentation [to potential suppliers] in Newton Aycliffe in May 2011, we were expecting 300 and there was 1,500 people turned up. Recently we had one for contractors and 400 companies turned up at that. The interest has been phenomenal. I realised what we had achieved when I did the introduction to our presentation and I was looking down at an audience of 1,500 people.”

The plant represents a £75m investment for Hitachi. Hunton won’t disclose the value of the deal to Merchant Place but he accepts that it has moved the company to a different plane.

“It takes us to a higher level. It provides us with the opportunity to develop the site as a whole. Hitachi is the catalyst to what we are doing with the whole site and the inquiries that we are now getting are showing that.”

Merchant Place is looking to acquire another site in Newton Aycliffe and still has two thirds of Amazon to find tenants for. Part of Amazon is earmarked for a waste-to-energy project.

Merchant Place Developments has a portfolio worth about £200m, part of Merchant Place group’s £1.5bn of assets. It has six sites running at the moment. Live projects include a Cambridge hotel and a David Lloyd tennis centre in Worcester.

“We’ve got other opportunities going all the time and Hitachi has really raised our profile.”

The company has an office in London and the main operation in Wideopen, where there are 11 staff.

Hunton married his wife Maureen in 1969 and they have two grown-up sons and a first grandchild due in December. Little wonder then that he is now looking at retirement over the next couple of years.

But he has some ambitions to fulfil first.

“My target is to get around 10,000 jobs in the supply chain for Hitachi. The catalyst was Hitachi and the whole dynamics of the thing has changed since the announcement was made, it’s now reality, it’s no longer will it, won’t it?

“Over the next three years we want to develop the Newton Aycliffe sites because there’s a window of opportunity over the next three years while we are developing the Hitachi site to bring more jobs and more facilities into the North East.

“I’m looking to retire over the next couple of years but I have objectives – I want to get the Hitachi project running, I want to make sure everything’s successful on this.

“You follow a dream when something like this comes up.”

The Questionnaire

What car do you drive?
Jaguar XF.

What’s your favourite restaurant?
Anywhere with good food.

Who or what makes you laugh?
Only Fools and Horses.

What’s your favourite book?
I like biographies. I’m reading one of Bill Clinton at the moment.

What was the last album you bought?
A compilation of 1960s pop music. I’m a product of the 1960s.

What’s your ideal job, other than the one you’ve got?
Don’t laugh at this – but in the 1960s I would have gone into pop management, I’d have loved that.

What’s your greatest fear?
Not giving something my best.

What’s the best piece of business advice you have ever received?
From my parents – be honest and work hard.

And the worst?
I haven’t got a clue.

What’s your poison?
Red wine in moderation.

What newspapers do you read, other than The Journal?
Daily Mail.

How much was your first pay packet and what was it for?
10s/6d (52 ½ p) training as an architect.

How do you keep fit?
Until recently, at the gym but with the knee operation that’s out of the question. Walking the dog.

What’s your most irritating habit?
Talking too much.

What’s your biggest extravagance?
Cars.

Which historical or fictional character do you most identify with or admire?
Haven’t a clue.

Which four famous people would you most like to dine with?
Bill Clinton and Tony Blair to see what makes the men tick and that’s the only two I can really think of.

How would you like to be remembered?
First as a family man and, second, for my commitment to the North East.

 

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