King of the lock-up garage: Rodger Dudding has built an empire from unglamorous property

October 15, 2013 4:59 pm

King of the lock-up garage

By James Pickford

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Rodger Dudding and his classic car collection, which was largely financed by his lucrative lock-up business

Rodger Dudding is pulling back from his business. “I’m winding down – I’m only working seven days a week,” he says. The hyperactive 75-year-old, dressed in a black pinstripe shirt with monogrammed cuffs, would have every justification to shift down a gear. Over a long career he has accumulated personal assets of £150m by building an empire in an unglamorous but increasingly valuable corner of the property market: lock-up garages.These rudimentary constructions, often tucked away down narrow lanes on neglected pieces of land, are hardly the stuff of Britain’s property-obsessed fantasies. But Mr Dudding has proved the value of his “ticky-tacky, graffiti-ridden” garages, as he describes them. Having spent half a lifetime acquiring them, he now has 12,000, making him the biggest private owner in the UK.

He is speaking at the offices of Dudrich Holdings in Southgate, north London, where he employs 40 people and turns over £12m a year. A short drive up the road is his other passion: a collection of 200 classic cars that are lovingly cared for by a staff of four in Mr Dudding’s private museum.

A trained engineer, Mr Dudding’s first company was in queue management systems – a business that still accounts for 30 per cent of group revenues. But from the early 1970s he began to dip his toe into the garage-owning niche.

The idea was first suggested by his then business landlord, a wealthy property owner and friend who advised him that lock-ups were a good investment. He offered to sell him a block of 10 in Thornton Heath, near Croydon in south London.

Unenthused by the deal but agreeing to it out of deference to his property market mentor, Mr Dudding promptly forgot about them until a rental cheque for £40 arrived from the management company. After a second cheque arrived three months later, he had an epiphany: “I thought, if I had a hundred of these producing £3 a week each, that’s serious Do-Re-Mi.”

He made a rough calculation that there were about 1m lock-up garages in the country, aside from those owned by local authorities. So he started to buy them up systematically using an approach that was as sly as it was enterprising.

While his young family slept at home, he would leave the house at 4.30am on a Sunday morning, consult his A-to-Z map and drive around an area until he found a block of garages. By 9am, at least one of the tenants would have arrived to clean their car or check on stored property. The affable Mr Dudding would sidle up and, “being economical with the truth”, pretend to be interested in renting another unit on the block. “I’d liberate four or five landlords’ names on the Sunday, then on Monday I’d phone them all up,” he explains.

The hobby that became a thriving business

Rodger Dudding made his fortune in the grubby world of lock-up garages. But he now spends much of his time surrounded by objects of beauty, after amassing a collection of 200 classic cars.

A 30,000 sq ft private museum in Potters Bar, Hertfordshire, just north of London, is packed with Mr Dudding’s Bentleys, Rolls-Royces, Jensens, Lagondas, Ferraris and Lamborghinis. The £15m collection is kept pristine by a full-time cleaner. White cotton gloves are left by the entrance for any guests who might be tempted to touch the vehicles.

Though he regards it as a hobby, Mr Dudding has been unable to resist applying his entrepreneurial nous to the collection, wringing out revenues by renting cars at £1,000 a day for weddings and other events. The cars are also used on film and television sets, including ITV’s Downton Abbey .

He points out an Aston Martin “wedge” Lagonda, pictured above, once owned by a Middle Eastern potentate, its external metal fittings made from 18-carat gold. “It’s one of only two gold-plated cars made by Aston Martin . . . Some of my staff are threatening to scrape it off and sell it,” he says.

He has run out of space for new acquisitions. But he is currently in talks with Enfield and Barnet councils to find a larger, more permanent site near the M25, where the public might one day be able to see these exquisite machines for themselves. “I regard them as three-dimensional works of art,” he says.

Asked which is the most valuable car in the place, he immediately points to a split-windscreen Morris Minor – worth about £8,000 on a good day.

“It belonged to my father. As far as I’m concerned, it’s priceless,” he adds.

Using a combination of his own capital and bank lending, he would offer about £1,200 for garages that were selling at the time for £1,000, and was quickly able to build up a property base. With a realm that now extends from Kent to Essex and as far north as Nottingham and Birmingham, such subterfuge is unnecessary today. “People come knocking on my door saying, ‘I’ve got a block. How much is it worth? Will you buy it?’”

He admits the business has a darker side. Criminals have long favoured garages as hiding places for stolen goods; Mr Dudding says his company regularly discovers drug factories on his properties, and sometimes murder victims. As the biggest owner of lock-ups, he is in regular contact with the police, passing on information when illegal activity is suspected.

The quiet seclusion of many lock-ups also makes them a location for suicides, and Mr Dudding has himself encountered several victims. One lesson he learnt early on was never to open a car door with a body inside. On the single occasion when he did, the swollen body exploded. “It was most unpleasant,” he says.

Perhaps the most eye-catching use for his properties is for extramarital liaisons. He remembers one instance where the company, during a routine check, discovered the tenant had constructed a room within the garage, complete with internal dry-lined brick walls, a double bed, carpet, gas heater and refrigerator. “It was his afternoon nooky shop – the first one I’d ever seen. It really tickled me,” he says. For tenants with such needs, he jokes, a lock-up garage is cheaper and more anonymous than a hotel – and more stable than a caravan.

With thousands of clients, each typically paying £15 a week, it is a management-intensive business. He runs it “with a rod of iron”, insisting on quarterly payments in advance and evicting those who fail to pay, retaking possession of their lock-up. But the discipline appears to pay off. “We have a bad-debt situation of only £25,000 a year off a rental income of probably £10m a year,” he says.

Since he has a virtual monopoly in some areas – he says his nearest rival has 800 garages – could he not set any price he likes? He prefers a pragmatic approach, fixing a rent that people are likely to be able to pay and which will therefore help keep his sites 100 per cent occupied. “A partly let site will precipitate damage and vandalism.”

Known as “RD” to his staff, Mr Dudding eschews computers, preferring to dictate emails to his secretary. It does not appear to have hindered his dealmaking, however. He runs a development business alongside the garages, building between five and
25 properties a year on the lock-up sites. He would do more but for the planning authorities.

“I’m about to build some houses in Crouch End. It’s taken me 12 years to get consent and probably cost me £100,000 in fees.”

Unlike most brownfield developers, though, he ensures his assets are working for him while he waits. “Whether it takes one year or 10 to get planning consent, I’ve got an income through the garages,” he says.

Even as a child he displayed an instinct for business. Growing up amid postwar austerity, he bred rabbits and sold them to the local butcher. By the time he started an apprenticeship with the Royal Navy, his various moneymaking activities had earned him £300, “which in today’s parlance is about £10,000”.

Though widowed earlier this year after 53 years of marriage, the indefatigable Mr Dudding is unlikely to retire to the property he bought some years ago in West Palm Beach, Florida. “I’ve only been there twice,” he says. “For me, holidays are for wimps.”

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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