British Land, a leading UK real estate investment company, has announced a significant expansion of its retail park portfolio with the acquisition of seven retail parks from Brookfield Asset Management for a total of £441m ($578.4m), the Times reported.
The company plans to fund the acquisition in part through a proposed equity placing of approximately £300m, reflecting its strong confidence in the long-term growth prospects of retail parks.
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British Land has been strategically investing in retail parks since 2021, recognising their unique appeal to both retailers and consumers.
The company’s CEO, Simon Carter, highlighted the three key advantages of retail parks: affordability, adaptability, and accessibility.
Retail parks offer lower rental rates compared to traditional retail spaces, allowing retailers to operate more efficiently.
Meanwhile, flexible layouts and ample parking make them ideal for click-and-collect services and last-mile delivery operations.
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By GlobalDataThe seven newly acquired retail parks are currently 99% let, underscoring their strong tenant demand and performance.
British Land is optimistic about the continued growth of retail park rents, particularly in contrast to other segments of the commercial property market.
According to the Times, despite challenges faced by the commercial property sector due to rising interest rates, British Land’s shares have been trading at a discount to their net asset value.
However, the company’s CEO expressed confidence in securing shareholder support for the equity placing given the accretive nature of the acquisition and its potential to deliver attractive returns.
The acquisition of these seven retail parks represents a strategic move for British Land, reinforcing its position as a leading player in the UK retail park market.
As the company continues to capitalise on the growing demand for flexible, accessible retail space, it is well-positioned to achieve sustainable growth and deliver value to its shareholders.
