Meadowhall gets major investment despite uncertain property market

An artist's impression of the proposed new 300m leisure hall at Meadowhall in Sheffield

Despite the uncertainty, the group has invested £23m in improving the retail environment at Meadowhall and it has plans for a £300m leisure extension at the site.

It expects a planning decision on the 322,000 sq ft leisure centre over the summer with a view to starting on site in 2018.

British Land’s chief executive Chris Grigg said: “Our plans envisage a multi-level leisure hall with dining and entertainment options alongside high quality internal and external spaces for events and community use, including new restaurants, a new cinema, cafe court and gym.“

The group said the plans represent the single biggest investment in Meadowhall since it opened more than 25 years ago. At over £300m, the proposals are also one of the largest investments in the Sheffield City Region for a decade and will create over 1,000 jobs.

Charles Maudsley, head of retail and leisure for British Land, said: “We are continuing to drive Meadowhall’s evolution to ensure it remains an outstanding place for modern consumer lifestyles. This significant step change in the scheme’s leisure provision will contribute to Sheffield’s continuation as a driving force behind the Northern Powerhouse. This is a very exciting time and we look forward to working with Sheffield City Council to help ensure Sheffield’s future success.”

The leisure hall is due to open to visitors in late 2020/early 2021.

The update came as British Land announced an 85 per cent slide in pre-tax profits to £195m in the year to March 31 after its property values fell 1.4 per cent.

The group said it had seen a bounce back in net asset values since the post-Brexit vote drop, rising 1.6 per cent in the second half.

Pre-tax profits rose 7.4 per cent to £390m on an underlying basis.

Mr Grigg said that as part of the overhaul of Meadowhall’s retail offering, the centre is attracting more premium brands including upmarket fashion retailer Ghost London and heritage brand Hawes & Curtis.

In other parts of the country, British Land said businesses are taking longer to commit to property decisions amid worries over Brexit and are focusing on the “best quality” space.

Mr Grigg said: “Looking forward, the picture is a mixed one. The Brexit process has begun but uncertainty will continue for some considerable time.

“London occupiers, particularly financial institutions, are making contingency plans but there is a wide range of possible outcomes here.

“Our conversations with occupiers tell us that a large majority continue to value London and believe in its place as a global centre, as we do.”

The commercial property sector was sent reeling after the EU referendum last June amid fears over plunging prices following the vote.

However, British Land saw a vote of confidence in the capital after it clinched a £1.2bn deal in March to sell London’s “Cheesegrater” building to the investment vehicle of Chinese property magnate Cheung Chung Kiu. CC Land bought the Leadenhall Building for a significant premium.

Mr Grigg cheered a “good set of results” despite an “uncertain environment over the last 12 months”.

“We are particularly pleased by the increase in underlying profits, by our strong leasing performance across the business and by the very successful sales we have made,” he added.