A unit trust controlled by Pillar is planning to transform a retail park near Rotherham, which it bought for £260m this week.
Hercules Unit Trust, in which Pillar has a 34% stake, has bought the 520,000 sq ft (48,300sq m) Parkgate “fashion park”, which lies 10km west of the M18, from Stadium Group.
Pillar wants to change the retail mix at Parkgate to match that of its successful Fosse Park, off the M1 in Leicestershire. The group confirmed the sale of Fosse Park to Leo Noe’s REIT Asset Management this week for £308m, an initial yield of 5.8%.
Valentine Beresford, director at Pillar, said: “Anybody who owns a fully open A1 shopping park has got to want to try to turn it into a Fosse Park.
“I’m not saying we’re going to be able to turn a £40 rent into a £90 rent overnight, but when we bought Fosse rents were £60 and it would be disappointing if we couldn’t replicate that at Rotherham.”
Jonathan Mather, investment director at Nelson Bakewell, said: “Parkgate will never be Fosse Park because it has not got the communications links. But Pillar has good contacts and will be able to get new retailers in.”
Pillar also announced the sale of its 320,000 sq ft (29,800 sq m) Manchester Fort retail park to Universities Superannuation Scheme for £167.3m, a 4.5% initial yield.
In total, Pillar concluded £795m of retail park transactions this week.
Harvey Spack Field, CBRE and Wilkinson Williams advised Pillar on Parkgate, Fosse and Manchester Fort, respectively. Stockford Staunton and Anderson Harkins acted for Stadium, Franc Warwick
for REIT and Jones Lang LaSalle and Harvey Spack Field for USS.
References: EGi News 22/02/05
