UK-focused retail REIT Capital & Regional has acquired a shopping centre in the south of England for £78 mln (€90 mln) from European investment manager Meyer Bergman.
The deal for the 300,000 sq ft (28,000 m2) Exchange Centre in Ilford represents a net initial yield of 6.7%.
'The acquisition of the Exchange Centre, Ilford provides us with an opportunity to redeploy quickly the capital released from our two recent successful disposals into an investment which offers strong income and capital growth prospects and dominates the retail offer in a large and growing cosmopolitan East London town,' commented Hugh Scott-Barrett, Capital & Regional's chief executive.
Located opposite Ilford train station, which will be rebuilt ahead of the opening of Crossrail, the Exchange Centre comprises 77 units over three levels and is anchored by Debenhams and Marks & Spencer. Other retailers include H&M, Next, River Island, Sports Direct, TK Maxx and Wilko.
The acquisition, which will be executed via the purchase of the holding company that owns the property, will be funded from Capital & Regional's existing cash resources, including recycling the proceeds from the recent disposals of The Mall Camberley and the Group's Buttermarket Centre, Ipswich joint venture. In addition, a new seven-year debt facility of £39 mln (€45 mln) has been secured on the asset with DekaBank.
'The Exchange is a centre we know well having previously been owned within The Mall,' added Scott-Barrett. 'We see significant opportunities for leisure and residential development supported by an ambitious local authority that is keen to facilitate investment in the area, and the new Crossrail link, which is expected to open in 2019,' he concluded.
