Capital & Regional plc, the UK focused specialist property REIT, today announces the unconditional exchange of contracts for the sale of The Mall shopping centre in Camberley to Surrey Heath Borough Council for a cash consideration of €95.6m (£86m), representing a net initial yield of 5.9%.
Completion of the sale is expected to take place by the middle of November 2016.
€50.2m (£45.2m) of the proceeds from the sale will be used to repay debt secured on the property as part of The Mall loan facility. The balance will be held for re-investment in the Company’s shopping centre business, including the ongoing capex programme and acquisitions.
The Mall, Camberley contributed approximately €2m (£1.8m) to the Group’s profit for the six months ended 30 June 2016. The valuation at 30 June 2016 was €98.34m (£88.5m), representing a net initial yield of 6.15%.
Hugh Scott-Barrett, Chief Executive commented: “The disposal of The Mall Camberley, which originated from an unsolicited approach from Surrey Heath Borough Council, will put us in a strong position to recycle capital for growth. We will look to reduce leverage, invest in higher yielding asset management initiatives and take advantage of the increasing number of attractive new investment opportunities which we have identified.”
