Hammerson and LaSalle Investment Management are selling a major slice of the £450m Highcross shopping centre in Leicester.
The joint venture is bringing a 50% stake in the 1.2m sq ft prime regional shopping centre to the market for £225m – a 5.5% net initial yield.
The proposed sale will see LIM, on behalf of the Royal Mail Pension Plan, sell out of its 40% stake entirely, with Hammerson offering up a 10% share. The retail REIT is expected to retain a 50% stake and the management contract. The joint venture was due to come to an end in 2015.
The opportunity is expected to attract interest from sovereign wealth funds keen to get greater exposure to property and a foothold in the UK retail sector.
The freehold shopping centre is anchored by John Lewis and features a 12-screen Cinema de Lux. It reopened in 2008, 90% let, after it underwent a £350m extension and refurbishment. Tenants include Apple, Debenhams, Swarovski, L’Occitane and House of Fraser.
The UK shopping centre investment market has seen significant investor demand and tight supply this year. Investors with more than £3bn of equity are currently believed to be tracking prime UK malls.
A source said: “There is a lot of interest in prime shopping centres. Rarely do you see an opportunity to invest in a regional and super-regional mall like this.”
Meanwhile, British Land with Norges, Land Securities and Hammerson all submitted final bids to buy Lend Lease’s 30% stake in Bluewater in Kent. It is expected to fetch £600m.
CBRE is advising Hammerson/LIM.
annabel.dixon@estatesgazette.com
