European private equity firm Henderson Park has exchanged contracts for the acquisition of the Silverburn shopping centre in Glasgow.
The off-market transaction from a joint venture between Hammerson and Canada Pension Plan Investment Board has been confirmed for £140m.
This deal has been undertaken alongside Eurofund, which will act as Henderson Park’s operating partner.
The 100,000 sq m shopping centre originally opened in 2007 and currently consists of 125 grocery, retail and leisure units, including Next, Marks & Spencer and TK Maxx.
The leisure extension, which was completed in 2015, added a 14-screen Cineworld and 11 restaurant units, including Pizza Express, Five Guys and TGI Fridays.
Silverburn sits on a 67-acre freehold site, which also includes 4,500 car parking spaces and the largest Tesco in Scotland, under a long leasehold interest.
Located in Pollok, the centre has a catchment area of around 1.9 million people, 80% of which are within a 21 minute drive.
Silverburn is currently 78% physically occupied and rent collection from the remaining tenants stood at 92% during the third quarter this year.
Christophe Kuhbier, managing director of Henderson Park, commented: “Silverburn with its large catchment area close to one of the U.K.’s largest cities has limited direct competition and posted robust footfall levels and cash collection this year.
“With retail valuations under pressure in recent years, we have been monitoring the UK prime retail market and we see here an excellent opportunity to acquire this asset off-market and invest in a modern asset with immediate upside potential.
“Our asset management plan aims at attracting new occupiers that focus on leisure, food and beverage and experiential retail sectors, completing the repositioning of the asset as a premier retail and leisure destination.”
Ian Sandford, chairman at the Eurofund Group, added: “We are excited by this opportunity to unlock latent value from this exceptional Top 20 UK shopping centre asset which has to date been underperforming.
“International brands have expanded their footprint in Scotland at Silverburn, most recently Tommy Hilfiger - demonstrating the attractiveness of the flagship destination globally.”
The joint venture was advised on this transaction by BCLP, Brodies, Alvarez & Marsal and Time Retail Partners.
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