Frasers, the retailing empire set up by Sports Direct tycoon Mike Ashley, is closing in on two major shopping centre acquisitions: a 50% stake in the Princesshay estate in Exeter, and a 100% acquisition of Frenchgate, the 768,000-square-foot shopping centre in the heart of Doncaster, CoStar News can reveal.
CoStar News revealed in February that global investment manager Nuveen was selling its 50% interest in the Princesshay estate in Exeter, a major UK shopping centre plus retail, offices, restaurants and leisure in the heart of the city.
Savills has been handling the stake sale and has been seeking around £40 million. The Crown Estate owns the remainder.
It is Exeter’s primary shopping centre.
The mall comprises 400,000 square feet of part-open air, part-covered retail and food and beverage provision attracting 10.6 million in 2023, reports Savills. The scheme is configured with a range of malls and parades, connecting the shopping centre to the surrounding retail pitches, including High Street, Princesshay Square, Roman Walk and Paris Street. There is 630,000 square feet of floorspace across the estate.
Tenants include Reiss, Next and Zara. Included in the estate are two car parks, Princesshay Car Park and Summerland Gate Car Park, providing over 500 landlord-controlled car parking spaces, contributing 4.63% of total gross income.
Nuveen bought its half of the estate from Landsec in 2014 as part of a strategic swap that saw Landsec take its ownership in Buchanan Galleries in Glasgow.
Separately, Frasers is further along in the process of buying another major mall, this time in Doncaster.
Savills has been acting on the sale of Frenchgate, the food store-anchored city centre scheme on behalf of a private investor seeking £35 million or a 10.5% net initial yield.
As an example of how values for leading shopping centres have fallen over the past two decades, the mall was sold in 2008 by Teesland and Equity Partnerships for £245 million, reflecting a net initial yield of 6.75%, to the Frenchgate Limited Partnership.
Anchor tenants include Sainsbury’s (39,750 square feet), Boots (35,361 square feet), and bargain department store Boyes (22,238 square feet). Frenchgate has a weighted average unexpired lease term to expiry of 11.19 years and weighted average unexpired lease term to break of 9.71 years.
Savills advises that the mall offers significant asset management opportunities and development potential, including the reletting of the former Debenhams department store.
Sports Direct tycoon Mike Ashley's Frasers has been increasingly busy buying retail assets rather than merely leasing for its own occupation.
Last year it bought The Mall shopping centre in Luton from Capital & Regional for £58 million and the Overgate Centre in Dundee for £30 million. It also bought Junction 32, an outlet shopping centre near Castleford, West Yorkshire, for £50 million.
Mike Murray, the son-in-law of Mike Ashley, who is now the chief executive of Frasers, hails from Doncaster.