Landsec has exchanged contracts to acquire a 100 percent stake in Metrocentre in Gateshead, England, from Tynehawk Holdings (Jersey) Ltd. for £516 million ($694 million).
The purchase price reflects an in-place net rental income yield of 7.9 percent, based on £41 million ($55.2 million) of net rental income. The acquisition is expected to be funded through an equity issue and existing debt facilities.
Metrocentre is a top-10 U.K. shopping center by sales and attracts more than 16 million visitors annually. The property includes 282 stores across 1.86 million square feet of leasable space, as well as an adjacent 200,000-square-foot retail park with 15 units. Overall occupancy is 95 percent, with an average lease term of 4.5 years.
The acquisition is part of Landsec’s strategy to invest an additional £1 billion ($1.35 billion) in major retail assets. Following completion, Landsec will own three of the top 10 and eight of the top 30 shopping centers in the Uni
