Rosette Merchant Bank has bought the House of Fraser building in Cardiff on behalf of Middle Eastern Investors in an off-market equity and finance deal valued at £38 mln (44 mln).
Purchased by Sharia-compliant Rosette's new structured products arm, in partnership with Naissance Capital Real Estate, the deal represents a yield of 6.25%, according to media reports.
The property, which was refurbished in 2008, is 98% leased to House of Fraser until July 2039 with the remainder let to the landlord of a public house until 2024. Sources close to the transaction said the property generates around £2.5 mln per annum in rents.
Seller M&G Real Estate bought the property in 2009 for £27 mln, at a yield of 8.65%.
Cardiff, which ranks as the 6th largest retail centre in the UK, saw a 150% increase in footfall in the past four years following the extension of the St. David's Shopping Centre by Land Securities and Capital Shopping Centers.
Rosette Merchant Bank and Naissance Capital Real Estate were advised by Cooke & Arkwright. M&G was represented by Allsop.
