Hammerson and Canada Pension Plan Investment Board (CPPIB) have acquired Silverburn shopping centre in Glasgow for £297 mln (EUR 334 mln). The two parties said on Monday that they have entered into a 50:50 joint venture which has acquired Retail Property Holdings from The Elementary Property Company which acted as its receiver. Retail Property Holdings' main asset is the freehold interest in the 93,000-m[sup]2[/sup] Silverburn mall.
Hammerson and Canada Pension Plan Investment Board (CPPIB) have acquired Silverburn shopping centre in Glasgow for £297 mln (EUR 334 mln). The two parties said on Monday that they have entered into a 50:50 joint venture which has acquired Retail Property Holdings from The Elementary Property Company which acted as its receiver. Retail Property Holdings' main asset is the freehold interest in the 93,000-m2 Silverburn mall.
The joint venture partners each committed £148.5 mln to the acquisition. The current gross rental income is £18.4 mln, representing an initial yield of around 6% and an equivalent yield of 6.8%. After operating costs, net income will be approximately £17 mln in 2010.
Hammerson will be the asset manager for the joint venture.
Silverburn, which opened in 2007, is a single-level covered centre anchored by Debenhams, M&S, New Look, Next and Tesco Extra. It provides 94 retail units let to high quality retailers, has an occupancy level of 98%, and an average unexpired lease term of over 12 years. The centre attracts approximately 14 million customers per year.
Hammerson will fund the acquisition from existing bank facilities which have a margin of 37.5 basis points over LIBOR.
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