Landsec increased its stake in Bluewater to 74 per cent after completing a £95 million deal to buy a further 10 per cent of the Kent shopping centre.
The landlord said the acquisition would give it greater flexibility in managing its investment and deliver efficiency savings. The purchase price represented a yield of 7.4 per cent, based on the net rental income generated by its existing holding.
Bluewater’s sales and visitor numbers continue to outperform the wider market.
Retail sales at the centre increased 7.4 per cent in the five months to August 31, while footfall rose three per cent. Landsec compared this with a 1.7 per cent decline in sales nationally and flat visitor numbers.
It said Bluewater was benefiting from retailers concentrating their investment on fewer, larger stores in leading shopping destinations.
Next opened a 132,000 sq ft store at Bluewater in July, taking over the former House of Fraser unit and tripling its presence at the centre. The retailer described the branch as its largest UK store.
The expanded shop included broader clothing ranges, a larger homeware department and a Costa café. It replaced Next’s previous 44,600 sq ft unit and became Bluewater’s first new anchor store since the centre opened in 1999.
Bluewater’s retail line-up also includes Aesop, Footasylum and Garage, while Hush recently opened its first store in Kent and the South East at the destination.
The investment followed Landsec’s agreement earlier this month to acquire Gateshead’s Metrocentre for £516 million, as part of plans to invest a further £1 billion in major retail assets.
Announcing that deal, Landsec chief executive Mark Allan said: “Growing our investment in major retail destinations remains our highest conviction call.”
He pointed to retailers’ demand for larger stores in established locations as a driver of rental growth. Landsec said the Metrocentre acquisition would bring its portfolio to three of the UK’s top 10 shopping centres and eight of the top 30 once completed.
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