M&G announces that it has extended a sizeable commercial real estate loan secured against a multi-million-euro portfolio of super-prime central London retail assets in Mayfair including the Gucci store at 144/146 New Bond Street and a significant portion of retail and residential assets on St Johns Wood High Street. It reflects the rebound in investor confidence and a continued recovery in valuations for assets in London’s fashionable prime retail markets. M&G’s Real Estate Finance team has a long-term relationship with the sponsor, Trophaeum Asset Management, having initially struck a deal in 2016.
The deal takes place against a backdrop of a rebounding occupier demand in central London luxury retail, with tourist numbers for the UK back to pre-pandemic levels and overseas spending at its highest in six years. Reduced vacancies in the capital are setting the scene for a return to rental growth in the sector, particularly for prime properties. Rents at the luxury end rose by 13.9% year on year, largely driven by Bond Street. M&G Real Estate has strong conviction in the strength of the West End’s real estate recovery and economy through its developments, such as the c. €238m Tottenham Court Road office scheme and the major modernisation of The Ribbon, a €297.5m, 7,432m2 mixed-use scheme with large retail offerings.
Dan Riches, Head of Real Estate Finance at M&G Real Estate, said: “London remains a top shop till you drop destination for tourists and the prime retail real estate market is benefitting from a strong rebound as luxury brands bag desirable spots on some of the world’s most famous destination shopping streets. We have a long-standing relationship with the sponsor and this deal is testament to the strong portfolio of assets that have been acquired and effectively managed over a number of years.”
Deepan Khiroya, MD for Trophaeum Asset Management UK, said: “We look forward to working with M&G with the renewal of our excellent working relationship across these assets. We too have experienced resilience in demand across our trophy assets and we continue to create luxury retail and office accommodation and strong destinations for our client base.”
Image source - Pexels.
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