British cities could sell assets worth billions of pounds including airports and prime real estate to plug budget holes and Birmingham is already talking to potential investors in the Middle East. Faced with demands from Britain's overstretched government for big spending cuts, Birmingham City Council leader Mike Whitby told Reuters he had been approached by sovereign wealth funds and was talking with the Abu Dhabi government. “We would allow them to be in partnership with our assets including the National Indoor Arena (NIA), the Symphony Hall, the ICC (International Convention Centre) and the National Exhibition Centre (NEC),” said Whitby whose council serves over a million people in Britain's second biggest city. The NEC Group, wholly owned by the council and which groups together Britain's biggest exhibition centre as well as other venues such as the NIA and ICC, has fixed assets worth about 750 million pounds ($1.2 billion) according to pre-credit crisis valuations included in the council's most recent annual report. NEC made an operating profit of almost 30 million pounds last year, on revenues of 110 million pounds. Whitby, a member of Britain's ruling Conservative Party, said wealthy investors had shown significant interest in the city's ‘Big City Plan' redevelopment during a recent trip to Kuwait when he spoke to the country's chamber of commerce. Such asset sales and foreign investment show how councils could invest in infrastructure despite expected cuts of 20-30 percent in their budgets, and would help the government towards its goal of using the private sector to lead economic recovery. One councillor who asked not to be named also said Britain's second biggest city could sell its stake in Birmingham Airport while a spokesperson for the northern city of Liverpool said it was conducting an “ongoing review of assets”. Rural communities too are looking for ways to raise cash. Ken Maddock, leader of Somerset County Council in the south of England, expects to sell about two-thirds of 60 farms owned by the council as it grapples with 350 million pounds in debt. “Like every other council in the country, we all face huge cuts in our funding,” he told reporters this month. “We will have to stop almost all our major building projects.” Somerset's so-called County Farm Estates run to about 7,200 acres which could be worth more than 40 million pounds based on the Knight Frank Farmland Index showing English farmland selling for 5,769 an acre in the second quarter of the year. Elsewhere in Britain council officials say Darlington Borough Council is in protracted talks about the sale of a stake in Newcastle Airport while authorities stretching from Camden in London and to Bolton in the north of England are reviewing the value of billions of pounds worth of property assets. Central government is also taking a closer look at its portfolio of assets, with trophies such as state-owned bookmaker the Tote up for sale. In Birmingham, which describes itself as Europe's biggest local authority, Whitby said Kuwaiti lead developer Salhia International Investments has already invested about 200 million pounds in the Beorma quarter development, the latest phase in the regeneration of the city centre. Plans to knock down and relocate the main library and redevelop the site in the heart of the city have also caught the eye of Middle Eastern investors, said Randal Brew, a locally elected lawmaker responsible for finance. “We have been successful in attracting quite a lot of Arab money, the leader has gone out and marketed the city,” Brew said during a recent visit to the city by Reuters reporters. “It is important because it is a new source (of investment).” The local business community is also busy forging ties with Middle Eastern investors, highlighted by a visit this month from Sheikh Ali al-Hashimi, religious advisor in the United Arab Emirates ministry of presidential affairs. “We want to see if we can get sovereign wealth attracted to projects in Birmingham,” said Noor Siddiqi, a lawyer, who organised al-Hashimi's trip. “London has the attention of most of the world but other regions like Birmingham have a massive Muslim community and can relate to Muslim countries.” Britain's sixth busiest airport is worth about 870 million pounds.
