Landsec has acquired a 92% stake in the Liverpool ONE shopping centre for £490m.
The REIT has acquired a 69% stake from a wholly-owned subsidiary of the Abu Dhabi Investment Authority (ADIA) and 23% from Grosvenor – Starpool owns the remaining 8%. Of the total consideration of £490m, a payment of £35m to ADIA is deferred for two years. The income return on Landsec’s initial £455m outlay is expected to be circa 7.5%.
The centre’s current rental income is 4% below ERV and Landsec expects rental income to grow “meaningfully” in the coming years.
Mark Allan, chief executive officer at Landsec, said: “The top 1% of the UK’s shopping destinations provide brands with access to 30% of all in-store retail spend, which is why we continue to see brands focus on fewer, but bigger and better stores in the best locations.
“As such I am delighted that we have added another top-ten centre with a highly attractive return profile – meaning our unique portfolio now includes seven of the top 30 centres in the UK. Liverpool ONE already has a great line-up of brands in a thriving location and we look forward to building on this with our leading operating platform to further add to its exciting growth story.”
James Raynor, CEO of Grosvenor Property UK, added: ”Liverpool ONE is a phenomenal destination and we’re incredibly proud of what we’ve accomplished with and for the City over the last 25 years. It’s not only one of the most remarkable regeneration stories, re-defining what long-term investment and partnership can achieve, it continues to be one of the UK’s most successful retail and leisure destinations. And, under the unified ownership and management of Landsec, we know it will continue to thrive.
“Looking ahead, we have ambitious plans to grow and diversify the business and we will reinvest the proceeds from the sale in our core portfolio including our 10-year programme of investment in London and residential debt business, which has supported the delivery of 3,370 homes in just two years.”
