Monday 20 May 2019

€300m in shopping centre sales in train

Cork’s Wilton Shopping Centre is for sale at a guide price of €86m
Cork’s Wilton Shopping Centre is for sale at a guide price of €86m
Ronald Quinlan

Ronald Quinlan

Up to nine of Ireland's leading regional shopping centres with a combined value of between €300m and €400m could be competing for buyers by the end of this year.

The Irish Independent understands that a plan to bring Navan Shopping Centre to the market at a guide price in the region of €80m is being progressed, while the process of selecting selling agents to handle the disposal of three other shopping centres with a total value of €100m is also underway.

The sale of a number of Dublin suburban shopping centres could also be in prospect should US fund Varde, reignite its bid to sell Bloomfield in Dun Laoghaire, Kilbarrack in Donaghmede and the Mill in Clondalkin. The three properties were already offered for sale in 2017 by joint agents JLL and HWBC as part of the €43m Project Anchor portfolio.

News of the potential disposal of the seven shopping centres comes just over a week after Savills Ireland brought Wilton Shopping Centre in Cork to the market at a guide price of €86m, and two weeks after it put Limerick's CityEast Retail Park up for sale at a guide price in excess of €28m.

In the case of Wilton Shopping Centre, Savills Ireland is seeking offers in excess of €76m for the shopping centre, and €10m for an adjoining development site on behalf of its owners, US-headquartered York Capital, and Tony Leonard and Paddy McKillen's Clarendon Properties.

The move to sell Wilton Shopping Centre comes just over two years after York and Clarendon acquired the centre from Nama in a deal code-named Project Hazel. The April 2016 transaction included two other shopping centres in Galway, and in Drogheda, Co Louth.

The growing pattern of shopping centre sales comes at the same time as Sigma Retail Partners, which is headed up by Nama's former senior retail property adviser, Marcus Wren, and retail property specialist Neil Bannon, continue to work on plans for the flotation of Ireland's first retail Reit (real estate investment trust).

Sigma Retail Partners currently manages retail assets with a combined value of over €500m in 13 locations including Dublin, Galway, Navan, Bray, Drogheda, Naas, Thurles, and Waterford on behalf of US fund, Oaktree.

The centrepiece of the portfolio is the Square Shopping Centre in Tallaght, which Oaktree acquired for €250m last February. While that price represented a €17m premium on the €233m asking price quoted by joint agents JLL and Cushman & Wakefield for a "controlling interest" of over 90pc of the scheme's units, it was still a massive fall from the near €640m valuation the scheme carried in 2007 when financier Derek Quinlan's Quinlan Private sold a stake of around 51pc to developer Noel Smyth for €320m.

Oaktree's acquisition of the Square Shopping Centre is considered by industry sources to have provided the scale required for a public offering to proceed.

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