Hammerson has bought six retail assets from the St Martins’ portfolio for £208m, as tipped by Property Week (15.12.10).
The portfolio acquired by Hammerson includes the 694,000 sq ft Centrale shopping centre in Croydon, which was bought for £98m, the 95,000 sq ft Monument Mall in Newcastle, which was acquired for £28m, and the 136,000sq ft Elliott’s Field retail park in Rugby, which was bought for £40m.
The 183,000 sq ft Three Spires shopping centre in Lichfield, the 65,000 sq ft Cathedral Lanes shopping centre in Coventry and the 43,000 sq ft Wickes retail unit in Folkestone were purchased for an aggregate £42m.
David Atkins, chief executive of Hammerson, said: “This transaction is a rare opportunity to secure a group of good properties in strong trading locations with significant asset management potential. We believe we can rejuvenate and transform Centrale, Monument Mall and Elliott’s Field, thereby improving retailer sales and increasing asset values.”
The acquisition will be accretive to earnings in 2011, and will be funded from existing bank facilities, increasing gearing by around 6%.
Completion of the acquisition of all assets is expected by the end of March, with the exception of Three Spires, which is expected to complete later this year.
Centrale comprises 80 units, let to tenants including Debenhams, H&M, House of Fraser and Next. The mall offers Hammerson the opportunity to improve circulation, introduce new tenants and provide a cinema and catering offer.
Monument Mall comprises 16 retail units and a food gallery over four trading levels. The complex is adjacent to Fenwick and tenants include Boots, Peacocks, TK Maxx and Wallis. Hammerson will look to exploit restructuring opportunities at the shopping centre through a comprehensive reconfiguration of existing units and bringing in new retailers.
Elliott’s Field Retail Park comprises 10 units in four terraces, a standalone restaurant and carwash. Despite the open A1 consent, the freehold scheme’s tenants are predominantly bulky goods retailers including Comet, Halfords, Homebase, and Wickes.
Hammerson believes there is scope to create additional space and capitalise on strong demand from fashion and catering tenants, therefore increasing the overall rents from the property.
Hammerson was advised on the transaction by CB Richard Ellis. Savills were the selling agents.