Henderson Global Investors’ UK shopping centre fund has purchased a £130m (e192.3m) stake in Birmingham’s The Bullring from Australian insurer AMP Life. In exchange AMP has taken units in the fund, in order to increase its diversification to the UK shopping centre market.
AMP Capital Investors believe there is strong demand from Australian institutional investors for high quality UK shopping centres and intends to use this investment to create a feeder fund to enable Australian investors to access the UK retail property market.
This acquisition brings total assets in the shopping centre fund to £580m.
Launched in July 2004, the fund’s assets include a 33.9% stake in the Bullring, a 50% interest in both Buchanan Galleries, Glasgow, and Princes Quay, Hull, and an indirect investment in Bluewater, in Kent, and Touchwood, Solihull.
A development component to the fund has been designed to add returns to investors. In October, Henderson and Insight Investment submitted an outline planning application to Hull City Council for a major extension to Princes Quay Shopping Centre. The proposals are for a £300m retail-led development of approximately 550,000ft2, combining retail and leisure facilities with public squares and open spaces.
Henderson fund manager Myles White said: “Historically it has been very difficult for investors to buy into this sector due to lack of stock, lot size, and the specialist management required.
“Birmingham’s Bullring has all the attributes we are seeking in an asset, and, in our view, it’s the best shopping centre in the UK.
“We are delighted to increase the fund’s share of it, and to have AMP as an investor.’’