British Land sells stake in Meadowhall Shopping Centre at a premium
Listed property firm British Land has sold its 50 per cent stake in Meadowhall Shopping Centre to its partner, the Norwegian sovereign wealth fund, for £360m.
The transaction has valued the entirety of the Sheffield shopping centre at £734m, three per cent above its September 2023 book value.
“The impact of the transaction on full-year net tangible asset value per share is expected to be negligible, and the full-year earnings per share dilution is estimated to be 0.6p prior to reinvestment,” the firm said.
The shopping centre, which attracts over 20m visitors annually, is about 5km northeast of Sheffield city centre. It features 1.5m square feet of retail and leisure space.
After taking into account net debt of around £200m, British Land said it expected to bank around £156m from the sale.
As part of the transaction, British Land said it would remain as asset manager of the shopping centre, for which it will continue to earn fees in line with current terms.
The transaction is expected to be completed this July. Proceeds from the sale will be used for “general corporate purposes”, including reinvestment in retail parks.
British Land said the deal was “in line with its strategy to focus on retail parks and reduce exposure to covered shopping centres”.
“We have had a successful partnership with Norges over many years and are delighted to continue to work alongside them as asset managers of the centre,” Simon Carter, chief executive of British Land, said.
“Following the sale of Meadowhall, 93 per cent of our portfolio is now in our preferred segments of retail parks, campuses and London urban logistics. We will continue to grow our retail park portfolio; with low capex requirements parks offer attractive cash returns and at 99 per cent occupancy we are delivering strong rental growth,” Carter continued.