ONE of Somerset’s councils has seen the value of property it has invested in fall by more than £900,000 in one year.

Sedgemoor District Council, like other local authorities across the UK, has been purchasing commercial property to generate revenue to fund front-line services.

But valuations of three of its largest investments – including a retail park in Street – have decreased.

A council finance boss says the declines were not a cause of any immediate concern, and reflected changes to the basis on which properties are valued after they are purchased.

Last month, the National Audit Office (NAO) recommended changes to how local authorities manage the risks associated with their investments.

The council has five commercial properties in its investment portfolio, which cost nearly £30.5m when they were originally purchased.

It purchased the Street Retail Park in December 2018 at a cost of £8.264m.

But the property is now valued at £7.77m – a loss in value of £476,000.

Similarly, the council’s investment in the TKMaxx store on Worcester High Street has declined from £8.526m to £8.15m since its purchase in April 2019 – a reduction of £376,000.

A third investment – the Applegreen petrol station on Gloucester Road in Bristol – has declined from £2.345m to £2.280m since being bought in mid-2019.

This last reduction – of £65,000 – brings the total fall in the value of the council’s investments to £917,000.

Two additional investments – a unit on the Sowton Industrial Estate in Exeter, and a unit on the Aztec West business park near Bristol – have not changed in value since they were purchased (for £3.9m and £7.4m respectively).

The council is currently looking at a potential new investment for £5.27m.

The losses were confirmed in a report published before the council’s executive committee meeting in Bridgwater on Wednesday (March 11).

Alison Monteith, the council’s finance manager, reported that these losses were not a cause of any immediate concern.

She wrote: “We invest in UK commercial and residential property with the intention of making a profit that will be spent on local public services.”