CCLA, a specialist fund manager for charities, churches and local authorities, is preparing to buy a retail park in Brighton from Aviva Investors.
The deal to acquire Brighton’s Pavilion Retail Park, which initially sought offers in excess of £30.8m excluding VAT, reflects a yield of around 5.5% – narrower than the original 5.75% expected.
This yield puts the deal price at circa £34.4m, based on the site’s current passing rent of £1.89m.
Existing occupiers at the retail warehouse scheme, which measures 76,827 sq ft, include B&Q, Halfords, Aldi, Hobbycraft and Costa. The site has an average WAULT of 10.6 years to lease expiry, including breaks.
While investment deal activity for retail parks has remained sluggish so far this year, the sale of this particular asset has gained attention for its longer-term residential redevelopment potential.
The freehold extends to around 5.2 acres. There is also a residential and student housing development under construction at the adjoining Preston Barracks site, led by the University of Brighton and Brighton & Hove City Council. This is expected to complete in 2021.
Avison Young has been marketing the asset on behalf of Aviva.
CCLA manages investments for charities, religious organisations and the public sector. It has £8bn of assets under management, according to company literature.
A spokesman for CCLA confirmed its interest in the asset, and that the deal has not been finalised.
Aviva and Avison Young declined to comment.
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