Rockspring Property Investment Managers (“Rockspring”), on behalf of UK Value 2 LP (“UK Value 2” or the “Fund”), announces that it has completed the acquisition of Orchard Shopping Centre (“Orchard”) in Taunton from RBS for a consideration of £27.55 million (€35 mln), reflecting an initial yield of c.6.65% per annum.
Orchard was refurbished and rebranded in 2009 and is the dominant retail destination in the heart of Taunton, comprising 144,037 ft² (13.378 m²) of space with 60 retail units and eight residential units. It is currently leased to retailers including New Look, Waterstones, WHSmith, Superdrug, Santander UK and Ernest Jones, with a weighted average unexpired lease term of 5.03 years and ERV of almost £2.5 million (€3.2 mln) per annum. Lettings to L’Occitane, Bill’s Restaurant and Anytime Fitness were recently concluded by RBS’ Restructuring team.
UK Value 2 completed the acquisition within three weeks of placing it under offer and it is the Fund’s sixth investment. It provides a secure income stream with a number of significant asset management opportunities, consistent with the Fund’s core plus strategy.
Richard Bains, Rockspring Partner and Fund Manager of the UK Value series, said: “The Orchard Shopping Centre is a prime scheme in a dominant regional town, making it a strong fit with our retail strategy. In addition, there is clear scope for us to generate further value from the property with the development potential for an extension to enhance the leisure facilities in the town center. This is a worthy addition to the UK Value 2 portfolio and takes the aggregate value of the assets now in the Fund to over £200 million (€257 mln), with significant equity available for investment in 2015.”
Neville Paterson, Global Director, Real Estate, RBS Restructuring said: “During the two years of RBS’ ownership we have undertaken a series of successful asset management initiatives, including the completion of a number of significant lettings to well-known brands such as Bill’s Restaurant, Anytime Fitness, L’Occitane, as well as various lease regears, which have helped to reposition and improve the perception of the center.
Rockspring was advised by KLM whilst Savills acted for the vendor, RBS.