Henderson Park has exchanged contracts for the acquisition of Silverburn, a 100,000 sqm flagship shopping centre in Glasgow, U.K., in an off-market transaction from a joint venture between Hammerson and Canada Pension Plan Investment Board for £140 million.
This acquisition has been undertaken alongside Eurofund, who will act as Henderson Park’s operating partner.
Silverburn is a modern, high quality shopping centre that 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. The centre 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.
Silverburn is a Top 20 UK shopping centre located in Pollok, a wealthy suburb of the UK’s fifth largest city, Glasgow. As the city’s newest and highest quality shopping centre, Silverburn has a wide and affluent catchment area of c. 1.9 million people, 80% of which are within a 21 minute drive. The centre also benefits from strong transport links, with a major bus terminal located on site, and has historically generated consistently high footfall of 15 million.
The centre is currently 78% physically occupied and rent collection from the remaining tenants has been strong standing at 92% for Q3 2021.
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. Alongside our specialist operating partner Eurofund, 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. We look forward to investing targeted capital expenditure to maximise the potential of this asset and delivering strong returns to our investors”
Ian Sandford, Chairman 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. We aim to use our team’s asset management and operational expertise to bring the shopping resort concept and return Silverburn to the offering and performance levels the people of Glasgow deserve and to help it exceed its potential.
“Glasgow’s profile in the UK was highlighted recently as it was selected as the host city for climate change summit COP26. Furthermore, international brands have expanded their footprint in Scotland at Silverburn, most recently Tommy Hilfiger – demonstrating the attractiveness of the flagship destination globally”