The National Grid Pension Fund has completed the purchase of the Buttermarket Centre, Ipswich, from Capital & Regional and Drum Property for £54.7m – a yield of 5.9%.
The Buttermarket Centre was held in a 50:50 joint venture between Capital & Regional and Drum Property. Capital & Regional said it will recycle the proceeds from the sale into new investment opportunities.
The joint venture, Buttermarket Ipswich, bought the asset in 2015 for £9.6m, when it was 43% occupied by area, and invested £25.1m of capital to transform the scheme.
The 235,000 sq ft centre is now 89% let and is anchored by a 12 screen Empire cinema and family entertainment centre. Occupiers include TK Maxx, New Look and Pure Gym. Nine new restaurant units are now occupied by companies including Coast to Coast, Byron, Wagamama, Prezzo and Cosy Club.
Capital & Regional chief executive Hugh Scott-Barrett, said: “The completion of such a complex and transformational project in just a two-year period is a great showcase for our particular expertise and asset management skills, and the internal rate of return [of over 40%] we have delivered is a strong testament to the success of the investment.
“Following on from the successful sale of The Mall, Camberley, this disposal provides us with significant capital to reinvest into higher yielding opportunities.”
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