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UK shopping centre investment hits £722M in Q1 2015

Global real estate adviser Cushman & Wakefield’s latest UK shopping centre investment market update has revealed there were 16 transactions completed in Q1 2015, totalling £722 million.

This figure reflects a 60% decrease in volume of sales when compared to the significant transaction volumes of Q1 2014.  In fact, Q1 2015 has been the quietest quarter for more than two years.

The largest single transaction in Q1 2015 was Gingko Tree’s acquisition of the 50% share in the Bentall Centre, Kingston for £190 million (reflecting a NIY of 4.70%), while Cushman & Wakefield advised InfraRed and Hark on the purchase of St George’s Shopping Centre, Preston from Aviva Investors for £75 million (reflecting a NIY of 6.30%).

Other notable deals last quarter included Vixcroft and Cheyne Capital’s purchase of the Nicholson Centre, Maidenhead for £37 million (NIY 6.15%) and Helical’s sale of Clydebank Shopping Centre to Cerberus and Edinburgh House for £70 million (NIY of 7.25%).

Currently, there are 13 shopping centres under offer, with a combined quoted sales value of £520 million.  There are 10 shopping centres and three portfolios on the market with a combined quoting price of £1.23 billion.

Charlie Barke, Cushman & Wakefield’s head of UK shopping centre investment, said: “Investment demand remains buoyant but supply remains very constrained. We foresee that dynamic continuing over the next six months at least. Retail yields still look attractive compared to the other sectors and the diversity and depth of capital looking at the sector provides us with great confidence for the rest of the year."

Cushman & Wakefield recently launched two key sales: The Grafton Centre in Cambridge, on behalf of M&G with a quoting price of £92.5 million and the recently re-branded N1 scheme in Islington, ‘Angel Central’, where the guide price is £140 million.