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Indeed - their website http://www.mapeley.com/OurApproach/Customers/HMRC.aspx http://www.mapeley.com/OurApproach/Customers/HMRC.aspx The key thing is HMRC sold

by cmdkeen 11y ago

Indeed - their website http://www.mapeley.com/OurApproach/Customers/HMRC.aspx http://www.mapeley.com/OurApproach/Customers/HMRC.aspx The key thing is HMRC sold their properties off and then paid rent to stay there - rightly or wrongly that was the craze for a while. The issue was they sold them to a company registered overseas. The criticism is that the Government shouldn't have done that, or at least heavily penalised that when considering bids because of the future loss of tax revenue. Worth mentioning this isn't about currency evil Tory cuts, the buildings were sold off in 2001 under the party now in opposition.

dogma1138 11y ago
All government agencies did it they held billions in realestate so paying rent made much more sense. This is even quite common in business corporations sell their HQ to get a huge influx of cash and lease it back this is a pretty standard accounting trick.
- toyg 11y ago
  In the long run, it's a losing tactic. Assets can be used as collateral to borrow indefinitely; once you sell them, you lose that capability (and instead get a long-term recurring expense you don't control). More than one business went under because they did this "cashing out" trick without fully understanding the consequences.
  - tremon 11y ago
    It's more likely the people at the top did understand the consequences, but chose to anyway because of personal gains.
- foldr 11y ago
  Echoing toyg, this can't possibly make sense for a government. In the long run, they'll obviously pay more in rent than the buildings are worth.
  - rahoulb 11y ago
    Yes, but "long term" is more than one election away
  - dogma1138 11y ago
    of course it can owning those assets yields them nothing, selling and paying rent is cheaper, if rent becomes too expensive they can move out.
    - foldr 11y ago
      If they're going to move out, they could keep the building and rent it out themselves, and make more money in the long run that way.
deleted 11y ago
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by cmdkeen 11y ago

dogma1138 11y ago

All government agencies did it they held billions in realestate so paying rent made much more sense. This is even quite common in business corporations sell their HQ to get a huge influx of cash and lease it back this is a pretty standard accounting trick.

toyg 11y ago
In the long run, it's a losing tactic. Assets can be used as collateral to borrow indefinitely; once you sell them, you lose that capability (and instead get a long-term recurring expense you don't control). More than one business went under because they did this "cashing out" trick without fully understanding the consequences.
- tremon 11y ago
  It's more likely the people at the top did understand the consequences, but chose to anyway because of personal gains.
foldr 11y ago
Echoing toyg, this can't possibly make sense for a government. In the long run, they'll obviously pay more in rent than the buildings are worth.
- rahoulb 11y ago
  Yes, but "long term" is more than one election away
- dogma1138 11y ago
  of course it can owning those assets yields them nothing, selling and paying rent is cheaper, if rent becomes too expensive they can move out.
  - foldr 11y ago
    If they're going to move out, they could keep the building and rent it out themselves, and make more money in the long run that way.

deleted 11y ago

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