Joint venture sells interest in Meadowhall

LONDON & Stamford and Green Park Investments have sold their investment in Sheffield’s Meadowhall Shopping Centre.

The joint venture has sold its 50 per cent interest in the freehold of Meadowhall Shopping Centre to Norges Bank Investment Management, the manager of the Norwegian Government Pension Fund Global.

The purchase price values Meadowhall at £1.525bn, which reflects a net initial yield of 5.09 per cent and a £11.2m uplift in the valuation as at March 31, 2012. The net proceeds of sale for the joint venture’s 50 per cent direct share is £307.9m, generating a profit of £155.9m.

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British Land, the owner of the other 50 per cent share in the Meadowhall freehold, and Norges Bank Investment Management have signed a new joint venture ownership agreement. British Land will continue to manage the shopping centre.

Raymond Mould, Chairman of London & Stamford, said: “We are delighted to have completed the sale of our interest with Green Park in the Meadowhall Shopping Centre to NBIM.

“The performance of the Centre has been outstanding since our acquisition in February 2009. Despite difficult trading conditions, tenant performance has been generally good and in some cases exceptional. In almost all cases we have been protected under the guarantee provisions of our original acquisition where tenants have experienced difficulty.

“There is no doubt that there is strong demand globally for prime UK property and therefore we believe that this sale is timely. LSP and its Joint Venture partner will benefit from the additional cash the sale provides ensuring we are poised to take advantage of opportunities in the market which we are confident exist.”

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Chris Grigg, chief executive of British Land, said: “We are delighted to be joining forces at Meadowhall with Norges. As one of our largest shareholders and a leading international investor, Norges is an ideal strategic partner for British Land. Norges’ investment is a measure of the outstanding quality of Meadowhall and we look forward to working with them to continue to develop its potential in the years to come.”

Karsten Kallevig, chief investment office, real estate at Norges Bank Investment Management, said, “We are very pleased to be teaming up with a partner of British Land’s calibre and look forward to working together to further develop the long-term potential of Meadowhall.”