(Updated on 30 December 2024 to add Landsec comment)
Landsec is preparing to buy more prime shopping centres by generating cash from selling its remaining retail parks in the New Year.
According to reports in The Sunday Times, the REIT is looking to sell schemes in Northampton, Bexhill, Bracknelll, Broadstairs (Kent), Chesterfield and another near Lakeside shopping centre in Essex.
The publication reports that the parks were valued at £366 million in September, with a yield of 5.8%. They are 94.7% occupied.
Property agents Morgan Williams, Park Place Retail and XPROP have been lined up to sell the properties, with The Times adding that the sales are "likely to be carried out on a piecemeal basis".
A Landsec spokesperson said in a statement: "We’ve said consistently since the launch of our strategy in October 2020 that we are considering various acquisition and disposal opportunities that make financial and strategic sense to the business.
"We’ve seen evidence of this in our recent acquisition of Liverpool One following the sale of several non-core assets like Taplow Retail Park and the Accor portfolio earlier this year. We expect this capital recycling and reinvestment programme to continue into 2025.
"Unfortunately, we’re not able to comment on individual opportunities or market speculation at this time."
Reports that Landsec is looking to generate cash to acquire top-end shopping centres comes in the same month that the FTSE 100 property giant completed its acquisition of a 92% stake in Liverpool One, one of the country's premier shopping centres, in a transaction revealed by CoStar News.
The firm revealed in a stock market announcement on 17 December that it recycled proceeds from its £464 million of non-core sales earlier in the year to buy the North West scheme.
Following the deal, Landsec owns and manages seven of the top 30 shopping centres in the UK. Other major schemes in its portfolio include Bluewater in Kent (1.9 million square feet), St David’s Dewi Sant in Cardiff (circa 1.5 million square feet) and White Rose Centre in Leeds (circa 882,000 square feet).
In an interview with CoStar News in November, Cushman & Wakefield's head of UK retail and leisure, Dom Bouvet, said he was "hugely optimistic" about the future of the sector, with prime shopping centres showing low void rates and rental growth.
He said that the availability of debt was another significant factor helping to attract investors back to the sector after falling out of favour during the last decade or so, as he predicted increased investment volumes for next year.
Bouvet said: "I've been doing this for 20 years and it's exciting to see where this market was five years ago to where it is today. In terms of the next steps, we do envisage that yields will continue to come in on shopping centres in particular, we think the debt market will remain."
You can read the full interview with Cushman's Dom Bouvet here.