Frasers Group has bought the Debenhams store anchoring Londonderry’s Foyleside Shopping Centre, in Northern Ireland, in an off-market deal.
A Frasers department store concept will replace Debenhams, which is winding down its UK operations.
The freehold was sold by a vehicle called Foyleside Acquisitions, which lists executives from Curzon Advisers and investment fund Kildare Partners as its directors, for an undisclosed sum. The 370,000 sq ft shopping centre is owned by Kildare Partners.
Frasers, which is owned by Sports Direct billionaire Mike Ashley, has expressed interest in buying Debenhams as part of a potential rescue deal.
Paul Wilson, director of retail at Savills, who brokered the deal on behalf of the vendor, said: “We were aware of the necessity for Debenhams to adapt and change its in-store offer to meet changing consumer demands and in the case of Foyleside, this was likely to require a store downsize and lease restructure.
“As retained consultants and leasing agents to the landlord of Foyleside, we were very aware of the risk associated with the Debenhams covenant and likely capital expenditure required to reconfigure the store and re-purpose the surplus space which would have been created.
“Knowing the limited pool of end users for this space and that Debenhams’ business was likely to enter a CVA, we pursed Frasers and successfully struck a deal to sell the freehold interest. The Debenhams CVA gave Frasers the ability to secure vacant possession from a landlord break clause, but a liquidation will speed up the process.”
Fergal Rafferty, centre manager, said that Debenhams will continue to trade through the Christmas period before it moves out.
He added: “Foyleside welcomes department store Frasers as the latest addition to its tenant mix. In what has been a difficult trading environment in 2020, this significant investment will enhance the city centre retail offer as a whole and will reinforce Foyleside as the top regional shopping destination in the North West.”
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