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How do you turn an out-of-town leisure scheme built in another era into a potential trophy asset? Add some sheds.
This is the latest plank in the strategy for Star City Birmingham, the 23-year-old leisure complex next to the city's famous Spaghetti Junction motorway interchange.
Conceived in the mid-1990s, the original 392K SF scheme was the UK's largest when it was opened by George Clooney and Mark Wahlberg in 2000. It was rethought in 2008.
Now, with planning permission for a 100K SF logistics unit, the site is on the market for £65M, Property Week reported.
Quadrant acquired the scheme in 2016 in a deal with Cerberus Asset Management reported to be close to £60M.
The latest price tag reflects a modest recovery in value: F&C REIT bought the scheme from X-Leisure for £85.5M in 2006. Cerberus acquired the centre as part of a larger portfolio in 2014.
The newly granted planning consent allows for part of the 23-acre site fronting the M6 motorway and some of Star City’s existing leisure space to be replaced with a new industrial shed. Permission by delegated powers has also already recently been granted for a new 4K SF drive-thru restaurant in the car park and a 39K SF new electric go-karting track as the final leisure anchor.
Since purchasing Star City, Quadrant has radically overhauled the scheme with a rebranding and repurposing of key areas. Long-term leases with the two top-trading anchor tenants, Vue and Tenpin, have been successfully re-geared, while new tenants include third anchor Gravity entertainment and Costa Coffee as part of a newly built pod development.
The site, which has 900,000 people within a 20-minute drive, offers plenty of residual value if the new owners want to explore other options.
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