Thursday, February 6, 2014

News: British Land increasing share in Parkgate owners

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British Land has agreed to purchase £41m of additional units in Hercules Unit Trust (HUT), the Jersey-based property unit trust that owns Parkgate Shopping in Rotherham.

The trust owns and manages 17 retail warehouse and shopping parks, providing around 4.5 million sq ft and is worth around £1.5 billion.

Owned by Hercules Unit Trust, which is advised by British Land and managed by Schroders, Parkgate Shopping is one of the largest retail parks in the UK, home to over 40 shops and attracting around seven million visitors a year. It is valued at over £100m to the trust via a subsidiary, the Rotherham Unit Trust.

British Land is one of the largest property development and investment companies in the UK and owns and manages a portfolio of commercial property worth £17.1 billion. This includes Meadowhall shopping centre in Sheffield, which it owns alongside Norwegian sovereign wealth fund Norges.

British Land is acquiring the increased share at a price of £613 per unit, 3.8% below the latest net asset value (NAV), as part of a scheduled pre-emption process. British Land has also submitted an application to Schroders to acquire up to £35m of further units in the trust which have been tendered as part of this process.

Unit trusts are collective funds that allow private investors to pool their money in a single fund that is then managed by professional fund managers, thus spreading their risk across a range of investments.

The initial acquisition takes British Land's share to 54.2% from its current level of 49.2%, which means that the Hercules Unit Trust would become a subsidiary of British Land.

Charles Maudsley, head of Retail at British Land, said: "HUT has some of the highest quality retail parks in the country. The purchase of additional units is in line with our strategy of focusing on retail locations which are the preferred local destination for shoppers, are flexible, affordable and capable of remaining at the heart of retailers' omni-channel offer."

British Land website

Images: British Land

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