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Investment manager joins UK shopping centre fray with maiden purchase

By December 20, 2021 No Comments

Axis Retail Partners has exchanged contracts to buy an asset in Greater London


What: St George’s shopping centre in Harrow has been sold off-market
Why: Axis Retail Partners, part of Generali Group, has been on the hunt for its first asset after expanding into the UK this summer
What next: St George’s to bring consistent income to its new owners as more than 50% of the retail has been recently renewed or relet

Newly-launched Investment and asset manager Axis Retail Partners has exchanged contracts to buy St George’s Shopping Centre from RDI REIT, on behalf of pension fund clients of LaSalle Global Partner Solutions, React News can reveal.

React News understands the off-market purchase price to be around £40m, giving a net initial yield of 8.3%.

The shopping centre, in the Greater London town of Harrow, was refurbished in 2015 and sits on the town’s high street.

RDI REIT, at the time known as Redefine, bought the centre for £68m in 2011.

The purchase is the first in the UK for Axis Retail Partners, which was founded by Florencio Beccar and Toby Smith in 2018 in partnership with Generali Investments. Axis is representing Generali as it builds a €500m shopping centre fund, while also advising third parties.

The UK division was launched this summer following the recruitment of Robert Jewell from Land Securities as UK managing director.

St George’s totals 215,000 sq ft and has an annual footfall of around 9m customers. The centre focuses on convenience and value retail, with leisure and F&B anchors across more than 30 units alongside a 650-space car park.

Occupiers include TK Maxx, Boots, Deichmann, Wilkos, Nandos, Tortilla, Pizza Express and a 12-screen Vue cinema.

The scheme is now fully let following several new lettings that have recently completed including H&M, Puttstars, Haute Dolce and Trespass.

The centre is being acquired as an income-producing asset, with 52% of the retail income either renewed or relet over the last 18 months.

Toby Smith, CIO of Axis, said: “We are very pleased with having been able to execute our first UK deal. We have been active in the UK market for almost 2 years and believe that now is the right time to start investing as the market starts to recover from Covid-19, which continues to be the ultimate stress test to the sector.

“We are focusing on assets which are relevant retail destinations and that have a demonstrated track record of strong performance, a rebased rental level and offer an attractive income yield to our clients. If all this verifies, we believe this entry point is extremely compelling with attractive capital values on a per square foot basis.

“From this starting point, we bring our retail expertise and proprietary systems to manage the assets with a view to enhancing the asset’s sustainability and relevance so that they can form an important part of the local community over the long term.”

KLM Real Estate acted for RDI.

8 Dec 2021 | by Jessica Middleton-Pugh (React News)