LGP buys Dolphin Centre at discount

Legal & General Property (LGP) is buying the Dolphin Centre in the UK city of Poole from Dutch firm Wereldhave for £57.7 mln (€67 mln), reflecting a net initial yield of 7.81%.

The deal represents a 32% discount on the price of £85 mln (€99 mln) which Wereldhave said it paid for the centre at end-2010.

The shopping centre asset comprises 430,000 sq ft (40,000 m2) of covered retail space, arranged over three levels, together with open streetscape areas. The scheme is anchored by Marks & Spencer, Primark, Boots, BHS and Beale Department store, and contains a total of 119 retail and leisure units.

Dolphin Centre dominates Poole's retail offer, providing over 60% of the retail space, and benefits from an annual footfall in excess of 11 million.

'The quality of income currently enjoyed by the fund affords an opportunity to move up the risk curve on a selective basis where we feel that value exists for secondary assets which are capable of being repositioned,' said Mark Russell, fund manager to the Managed Fund at Legal & General Property. 'The Dolphin Centre offers a resilient income return, supported by a diverse tenant base and affordable rents. There exist a number of options to increase dwell time and enhance the tenant mix, with numerous retailers not currently represented in the town.'

Briant Champion Long represented Legal & General Property and Cushman & Wakefield acted for Wereldhave.