Bank forces £250m Silverburn sale

  Lloyds Banking Group has this week forced the owners of Silverburn in Pollok, south Glasgow, to put the 1m sq ft shopping centre up for sale.   It is the second forced sale of a major retail asset to emerge in as many weeks.   Deloitte, which was drafted in by Lloyds in July to advise on the future of the asset, has appointed Jones Lang LaSalle (JLL) to sell the almost fully-let shopping centre.   JLL is likely to seek around £250m – a circa 7.25% yield – for the property, which was valued at £350m when it was completed in October 2007.   Discussions are ongoing with Lloyds about whether it will staple debt to the asset to help facilitate a sale.   Silverburn is currently owned by entreprenuer Paul Green’s Retail Property Holdings.   Five of Green’s other offshore companies – Elementary Property Company, Premier Markets, Elementary Holding Company, Thorotat and Quest Investments – were put into administration in the summer.   David Raven, head of shopping centre investment at JLL, said: “Silverburn will be the largest lot sized UK shopping centre to be offered in its entirety to the market in 2009.   “It is the premier shopping centre within Scotland and will be highly sought after in the current market.”   He added: “The proposed sale of Silverburn, together with other sales that are anticipated to close by the end of the year should enable the market to see an annual turnover of more than £2bn – double the 2008 turnover. This illustrates the investor confidence returning to the market.”   Last week EG revealed that special servicer Hatfield Phillips had appointed Savills to sell three Shrewsbury shopping centres owned by the Protego-managed UK Actively Managed Shopping Centre Fund for around £50m – less than half their £118m 2006 acquisition price (5 September, p27).   A source said: “More stock will gradually come to the market from the banks but this shouldn’t be the start of the floodgates opening.”   While more than 30 parties are already understood to have shown their interest in Protego’s shopping centres, the potential buyer pool for Silverburn is expected to be much smaller.   However, it is likely to attract interest from Raymond Mould’s and Patrick Vaughan’s London & Stamford, institutions such Henderson, Sovereign wealth funds and North American investors.   “There are a lot of requirements for shopping centres in the £35m – £100m bracket but it starts to thin out for centres of more than £100m,” said one agent.   “Shrewsbury is only £50m and a lot of people are looking at it. There are not so many that have £250m for one lot.”   Silverburn will be officially brought to market in the final quarter of month.   annabel.dixon@rbi.co.uk