Ellandi/Curzon buy Newlands shopping centre

Posted by CoStar on 22nd Sep 2011

A joint venture between Ellandi Property and Curzon Capital Partners III, a fund managed by Tristan Capital Partners, has completed on the purchase of the Newlands Shopping Centre in Kettering for £32.5m – a net initial yield of 8.5%.

The 200,000 sq ft out of town shopping centre has been bought from Cornerstone Real Estate Advisors on behalf of UBS Wealth Management

Tenants include TK Maxx, TJ Hughes, Boots, WH Smith, JD Sports, Poundland, Home Bargains and the Early Learning Centre. The centre's average unexpired lease term is 5.9 years and produces an annual gross rental income of £3.4m pa.

There is also potential for further development on the site for up to 305,000 sq ft of retail space.

UBS and Cornerstone are also selling the 143,300 sq ft Arndale centre in Accrington , Lancashire, for 16.7m, a 9.5% yield. Strutt & Parker is advising.

The completed sale in Kettering is the latest in a very active shopping centre market where there is limited supply coming through for the next two years.

Shopping centre development has all but ground to a halt with Land Securities’ Trinity Leeds the only major scheme scheduled to complete in 2013, with 1m sq ft of new space.

Figures from Cushman & Wakefield this week suggested that there will be only 18,500 sq ft of new centre space added in the UK – the lowest annual provision in more than 50 years – after Westfield Stratford opened last week and bolstered the retail supply by 1.9m sq ft.

Consequently that market for secondary stock has been very active in 2011, with Savills predicting total sales of more than £5bn, and investors driven by a desire to snap up assets at good prices.

This week the retail industry’s major players gathered for the British Council of Shopping Centres conference in Manchester, where stark warnings about insufficient space were heard, in spite of the fact that many retailers still have substantial expansion plans.

Jones Lang LaSalle acted on behalf of Cornerstone Real Estate Advisers; Drivers Jonas Deloitte represented Ellandi Property Ltd and Tristan Capital Partners.

Source: CoStar

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