Landsec is in early talks to buy the 1 million-square-foot Silverburn shopping centre near Glasgow, CoStar News can reveal, as bidding intensifies on more than £900 million of UK mall sales.
Cushman & Wakefield is advising on the sale of the mall, which is expected to fetch up to £200 million if sold in its entirety.
Henderson Park and Eurofund bought the mall in 2022 from 50:50 joint venture partners Hammerson and Canada Pension Plan Investment Board for £140 million, with Henderson Park the majority investor.
In a stock market announcement in September, Landsec, the UK real estate investment trust with a £10 billion portfolio, said it had sold £295 million of offices, well ahead of schedule, and intends to accelerate capital recycling over the next 12 to 18 months, into major retail schemes.
It has been selling a number of London offices as it refocuses the business towards retail and residential.
In the announcement, Landsec described major retail as its highest conviction call "given the superior income returns and attractive growth in income".
Landsec said in a statement: “In line with our strategy, we've been clear that we're considering various acquisition and disposal opportunities that make financial and strategic sense to the business. Unfortunately we’re not able to comment on individual opportunities or market speculation at this time.”
Cushman & Wakefield declined to comment.
The talks at Silverburn come as there is significant progress on more than £900 million of UK shopping centre disposals.
The latest of the major UK shopping centres owned by Intu before its administration during the pandemic has come to market. Initial bids are understood to have been submitted for The Potteries in Stoke, with Lewis & Partners acting on behalf of the bondholders. The Potteries is a 628,889-square-foot mall that has 50 shops, seven restaurants and cafes and a 9-screen cinema. Stores include Primark, Flannels and H&M. The mall is expected to fetch in excess of £10 million.
Intu debenture is the vehicle which owns and finances the mall. It also financed Intu's former shopping centres at Eldon Square in Newcastle, Intu Soar at Braehead in Glasgow, and 48-58 Bridlesmith Nottingham. After the collapse of Intu, APAM was drafted in as asset manager with Savills acting as project manager.
The shopping centre group fell into administration at the end of June in 2020. It owned and operated 17 shopping centres across the UK. Each of the shopping centres was owned individually by special purpose vehicles or propcos which were outside of any insolvency process and continued to trade. Many have subsequently been sold either to joint venture partners or separate owners.
Elsewhere, Frasers is expected to complete its acquisition of the Braehead shopping centre near Glasgow shortly, in a transaction revealed by CoStar News. The highly acquisitive UK retailer and investor is lining up the mall for around £220 million. SGS Retail, the lender vehicle which owns the 811,000-square-foot centre, is being advised by JLL.
The US's Realty Group is also expected to complete the acquisition of the The Lexicon in Bracknell from a joint venture between Schroder Capital UK Real Estate Fund and Legal & General Capital, advised by JLL, for around £150 million.
Redical is now in pole position to buy the Merry Hill shopping centre in the West Midlands for more than £280 million although the deal is not expected to complete this year. Knight Frank is acting for the consortium of lenders that own the mall.
There is understood to be strong interest in The Broadway, a shopping centre in Bradford city centre, which Savills is selling on behalf of the Law of Property Act receivers, seeking £74.23 million, or a net initial yield of 9.5%.
There is also understood to be strong bidding for County Mall, a shopping centre in Crawley being sold by Arora.
Bids are also expected this week for Lion Yard in Cambridge which JLL is selling for Aberdeen, seeking in excess of £70 million.