Universities Superannuation Scheme has structured a deal with the three owners of Monks Cross near York to take a 25% stake in the shopping park.
The purchase means that the fund, which has been underbidder on a number of retail properties over the past few months, has finally secured a major investment.
It has agreed an off-market deal with Legal & General Property, BA Pension Fund and Schroder Exempt Property Unit Trust to buy parts of their stakes in the 273,000 sq ft shopping park.
The three parties have diluted their ownerships from 33.3% to 25% each, giving USS a quarter-share in Monks Cross.
USS paid around £53m for the shareholding, reflecting a 5.1% yield.
A source said: “Monks Cross is rated as one of the top three parks in the country and one of the only parks showing income growth. Rents are rising and there has been a recent letting to H&M. It has a Debenhams and two stores let to Marks & Spencer. There are no voids.”
He added: “The landlords have also bought in ownerships nearby, so the park has a lot of potential.”
The park’s owning body, Monks Cross Trust, was set up by Pillar Property, BA Pension Fund and SEPUT in 1998, when the trio bought the scheme from Richardson Developments and Kingspark Developments for £90m – a 5% yield. Two years later, Pillar sold its stake to Legal & General for £38.5m – a 5.4% yield.
Morgan Williams advised USS; Cushman & Wakefield acted for the Monks Cross Trust.
Retail park fund The Junction is investigating a sale of its 170,000 sq ft Ocean retail park in Portsmouth, Hampshire.
The fund, asset managed by Capital & Regional, has instructed Cushman & Wakefield to find a buyer for the bulky goods scheme.
It is seeking £58m for the property, which is let to eight tenants, including Toys R Us and Homebase. The lot size reflects a yield of between 6% and 6.25%.
annabel.dixon@estatesgazette.com
