Land Securities Group PLC (“Land Securities”) and Hammerson plc (“Hammerson”) announce that they have entered into the formal property pooling agreements for the Bristol Alliance, finalising the 50/50 joint venture arrangements through which they will progress together their plans for the Broadmead expansion.
This follows on from the announcement on 21 June 2004 that the two companies would be acquiring Morley Fund Management’s one-third share of the Bristol Alliance. The Bristol Alliance also confirmed that it signed the development agreement with Bristol City Council on 14 June 2004.
As a result Land Securities and Hammerson have now transferred their property interests into the Bristol Alliance, thereby pooling their respective holdings, and Hammerson has made a balancing payment to Land Securities of £30.8m. At the same time the Bristol Alliance has acquired additional property interests in Broadmead for a cost of approximately £22m from Morley Fund Management and Henderson Global Investors.
Following these transactions, the Bristol Alliance, in addition to the proposed development, will own as investment properties 72 retail units, totalling some 31,590 sq m (340,000 sq ft) with a current value of £107.4m. These assets currently generate an annual rental income of £6.7m.
The new scheme, which received detailed planning consent in December 2003, will create some 139,350 sq m (1.5m sq ft) of mixed-use space and incorporates 83,610 sq m (900,000 sq ft) of retail space. The scheme will provide new retail, leisure facilities, residential apartments and public spaces in the heart of Bristol, as well as offices. Marks & Spencer has agreed terms to occupy the 17,940 sq m (193,000 sq ft) four-storey department store.
A joint project team has been created between Land Securities and Hammerson to advance the scheme, building on the successful working relationship established between the two companies at Bullring, Birmingham.
It is anticipated that works will commence on site in mid 2005 and that the new scheme will open in 2008. On completion, the overall Bristol Alliance estate will comprise approximately 180 retail units, totalling some 115,200 sq m (1.24m sq ft).
Bob De Barr, Development Director, Land Securities, commented: “We are delighted to have achieved a number of important milestones so quickly, which have enabled us to maintain the programme. Having acquired Morley’s interest, it is a tribute to the entire team that we have been able to conclude the formal partnership documentation with Hammerson and sign the development agreement with the Bristol City Council. With the CPO inquiry now finished, we are making excellent progress on all fronts.”
John Richards, Chief Executive of Hammerson, added: “We are pleased to be working in partnership with Land Securities on the Broadmead expansion, which continues our programme of major retail-led regeneration schemes. The pooling of our properties and the restructuring of the interests in the Bristol Alliance is a significant milestone achieved and has provided additional impetus for the Bristol Alliance to move forward on this important project.”
Source: Land Securities