Saturday, February 27, 2021

Sheffield retail and leisure destination sold for £41 million

The joint venture between NewRiver and BRAVO Strategies III LLC (BRAVO) has exchanged contracts to acquire The Moor, a 28 acre estate in Sheffield city centre, from CEP ASI UKPF Nominee 1 Limited and CEP ASI UKPF Nominee 2 Limited, for £41 million.

The Moor estate is one of Sheffield’s designated city centre ‘quarters’ and has benefitted from significant private and public sector investment, which has established The Moor as the city’s primary retail and leisure destination.

Centred around an open-air pedestrianised thoroughfare, the estate provides 680,000 sq ft of retail and leisure space anchored by Next, Sainsbury’s, and an occupier-owned Primark, alongside a 670-space car park, a nine-screen cinema and The Moor Market, a covered marketplace owned by Sheffield City Council.

The estate comprises 15 assets capable of being sold separately, which provides inherent liquidity and offers a range of mixed-use development opportunities.

NewRiver has identified the potential to develop up to 1,100 build-to-rent residential units and up to 300 purpose-build student accommodation units, offering significant capital growth opportunities.

The Moor benefits from its adjacency to Sheffield City Council’s £470 million ‘Heart of the City II’ regeneration project, which is delivering a dynamic and vibrant mixed-use district in the city centre that connects all neighbouring quarters.

The project aims to generate 7,000 jobs in the city by 2030 and has already seen the development of a five-storey office building, which is fully let to HSBC and CMS, and a commitment by John Lewis to a new 20-year lease and refurbishment of its city centre store.

NewRiver says it will hold a 10% interest in the asset (NewRiver share: £4.1 million) and will benefit from 10% of the net rental income of £4.0 million per annum (NewRiver share: £0.4 million per annum).

Allan Lockhart, Chief Executive, said: “The acquisition of The Moor with our joint venture partner BRAVO represents a rare opportunity to acquire a 28 acre estate in one of the UK’s largest and fastest-growing cities, at a very attractive price which is far below the breakup value of the site.

“This acquisition will generate very attractive returns for NewRiver, driven by sustainable rental income and capital growth through the redevelopment of parts of the estate, principally for residential uses.

“Sheffield City Council has demonstrated that it is a forward-thinking and proactive local authority, and we look forward to working with them to deliver a vibrant and connected city centre.

“Taking a 10% stake ensures we maintain our financial discipline, as we remain on track to meet our target of £80 million to £100 million of disposals this financial year.”

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