Connect with us

Shopping

Sovereign wealth fund bets big on UK shopping centre recovery

Published

on

In a move signalling confidence in the future of prime UK retail locations, Norway’s sovereign wealth fund, Norges, is on the verge of acquiring full ownership of Meadowhall, a prominent shopping centre in Sheffield, UK, the Sunday Times reported.

Norges, managing an impressive £1.3trn ($1.6trn), is reportedly in advanced talks to purchase British Land’s 50% stake in Meadowhall for an estimated £363m ($447.47m), taking control of the entire centre.

This deal would value the shopping centre at roughly £725m ($893.71m), generating a yield of 7-8%.

The discussions mark the potential conclusion of a sales process initiated by British Land last September.

The Sunday Times noted, while an agreement between the two existing partners appears most likely, sources suggest Norges is exploring options with other potential buyers as well.

Interestingly, under the current terms, British Land, led by CEO Simon Carter, would retain its management role for Meadowhall, overseeing day-to-day operations for the new owner.

Access the most comprehensive Company Profiles
on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free
sample

Your download email will arrive shortly

We are confident about the
unique
quality of our Company Profiles. However, we want you to make the most
beneficial
decision for your business, so we offer a free sample that you can download by
submitting the below form

By GlobalData







Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

The centre boasts a prestigious tenant list that includes retail giants like Marks & Spencer, Zara, and Primark.

According to the Sunday Times, this acquisition aligns with Norges’ existing UK property portfolio, which includes significant investments in London’s West End.

The fund possesses a 25% stake in Regent Street, a vast portfolio managed by The Crown Estate, and holds a 23.5% share in Shaftesbury Capital, the owner of Covent Garden.

Additionally, Norges co-owns the West One shopping centre with British Land, strategically located near Bond Street Station.

Meadowhall itself boasts a rich history, rising from the ashes of a former steelworks on Sheffield’s outskirts. Developed by Yorkshire entrepreneurs Eddie Healey and Paul Sykes, the centre was sold to British Land in 1999 for £1.2bn ($1.48bn), marking a significant profit for the original developers.

However, the past decade has seen a decline in the value of UK shopping centres. The surge of e-commerce and persistent high business rates have triggered a wave of retail closures, impacting the sector significantly.

Norges’ decision to potentially acquire full ownership of Meadowhall indicates a belief that prime retail locations like this one can weather the storm and rebound.


Continue Reading