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Landsec, Frasers: 2 Faces, 2 Approaches To 2024 Shopping Centre Investment

Meadowhall Shopping Centre In Sheffield

Two very different companies are eyeing a couple of the biggest shopping centre deals in the UK in recent years.

Landsec, the UK’s second largest REIT and a cautious investor by reputation, is in talks to buy a 69% stake in the 1.6M SF Liverpool One mall for about £350M from the Abu Dhabi Investment Authority. Landsec CEO Mark Allan told The Times of London Sunday the company believes rents and values for UK shopping centres may have bottomed out and that there is value to be found in the sector.

One day later, retail entrepreneur Frasers emerged as a leading bidder eyeing the purchase of Meadowhall, the 1.4M SF shopping mall in Sheffield, for £750M, according to The Times, as reported by Retail Gazette. The retail group founded by Mike Ashley would buy the property from owners British Land and Norges Bank Investment Management.

British Land bought Meadowhall for £1.2B in 1999, selling a 50% stake to Norges in 2012 when the valuation for the scheme was £1.5B.

While Landsec is upping its exposure to malls, peer company British Land is pulling back, preferring to invest in London campuses, life sciences and retail parks.

Potential buyer Frasers owns brands like Sports Direct, Flannels and House of Fraser, as well as a 15% stake in online retailer Boohoo. Retail is its main business, and it has recently used the price drop in the market to snap up brick-and-mortar properties.

In March, Frasers bought the 907K SF The Mall shopping centre in Luton for £58M, the 420K SF Overgate Centre in Dundee for £30M, and the 252K SF Junction 32, an outlet shopping centre near Castleford, West Yorkshire, for £50M.

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