Terrapin renting option saves cash for business

Organisations planning future space requirements should consider the significant financial and practical benefits of renting a bespoke building, says leading offsite construction specialist, Terrapin.

Audited figures just released show that renting has highly attractive cash benefits over purchasing, while offsite building has considerable advantages over traditional construction methods.

Terrapin's rentable factory-built solutions for commercial and healthcare applications include air conditioned offices from as little as GBP8 per square foot.

With recession now forcing many companies to focus more sharply than ever on costs, businesses looking to grow with the next upturn need to invest wisely in any additional space, says Terrapin Finance Director Adrian Day.

And he says renting a bespoke, air conditioned Terrapin building is a wise option - especially in an uncertain economic climate, as medium term renting hedges risk.

"Our figures, audited by accountants, show that a typical 1,937 sq.ft (180m2) single storey Terrapin building rented for GBP11.32 per sq.ft per year for three years would save GBP58,558 against the net capital cost of GBP103,306".

"This is because rent on a hire building is fully tax deductible (saving GBP14,883) - and there is an additional benefit from freeing capital to invest in the business, rather than in the building, which would generate, say, GBP13,450 which could be offset against the cost of hire," he says.

The same building can be hired over five years at GBP10.11 per sq.ft and over 10 years at GBP8.03 per sq.ft.

He says a further benefit for healthcare buildings is that the renting option can be built into a services package, enabling the healthcare provider to finance the building from its operating budget rather than capital budget - and save on VAT at the same time.

Adrian Day says: "Renting a Terrapin building means you don't need a big cash outlay and you get the comfort of fixed payments to help cashflow planning".

"You get better utilisation of your existing site, with a quality structure that is fully compliant with Building Regulations".

"Another major advantage is that our factory built structures can be ready for occupation on your site within weeks of placing the order".

Terrapin buildings' costs include suspended ceilings with fluorescent lighting and air conditioning, double glazed aluminium windows, carpeting and a robust, maintenance-free external finish.

Rental costs do not include site-determined variables such as foundations, drainage, access steps and ramps, provision of electrical and other services, or crane hire for positioning the building panels.

Terrapin is a privately owned company and is one of the UK's leaders in offsite construction.

It has been expanding the potential of Modern Methods of Construction since 1949 and now offers a range of complementary MMC technologies that can be used individually or combined to create bespoke building solutions for every application; panel based technology, volumetric design technology and steel framed, element build technology.

Terrapin is the first company to be accredited under Buildoffsite's new supplier registration scheme operated by Lloyd's Register.

The scheme standardises all aspects of the offsite process and ensures best practice, offering clients confidence in the assured levels of competence, methodology and safe working of the accredited supplier.

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