A £700m retail property sell off has allowed two of Northern Ireland’s most prominent businessmen to retain control of their Foyleside and Forestside shopping centres. The disposal was ordered by Ulster Bank which wants to reduce its exposure on loans used to assemble the portfolio.
The package of eight shopping centres and parks across England, Scotland and the Republic of Ireland were offered for sale in May. At the time Simon Hope, head of global capital markets at agents Savills, described them as: “High profile assets of a very high quality with strong property fundamentals, well let with major asset management opportunities.”
The two Northern Ireland shopping centres are currently owned by two related firms, Foyleside Ltd and Abbey Centre Ltd, understood to be controlled by industrialist and former Ulster Television chairman John B McGuckian and Ken Cheevers, who owns the McLaughlin & Harvey building firm.
The other properties involved are the Marshes Centre in Dundalk, County Louth; Palace Exchange in Enfield, London; The Avenue shopping centre in Newton Mearns, Glasgow; Priory Meadow in Hastings, East Sussex, and the Fosse Shopping Park in Leicester (pictured).
Savills has so far refused to comment on the result of the bidding process, which has been taking place throughout June, but there are strong indications The Crown Estate remains the favourite to take over the £350m-valued Fosse Park.
A Crown Estate spokesman refused to confirm that it remained the preferred bidder for the Leicester retail complex. But last month James Cooksey, head of organisation’s regional portfolio, said: “As one of the top five owners of regional retail property in the UK, The Crown Estate continues to seek opportunities that align with our investment strategy and we are considering a bid for Fosse Shopping Park in that context.”
Other, yet to be finalised deals, include the £60m purchase of Enfield’s Palace Exchange by Standard Life Investments and Kennedy Wilson Europe’s acquisition of the Marshes Centre in Dundalk for around £30m.
In a separate money raising sell off the McGuckian and Cheevers-owned Abbey Centre in Newtownabbey, north of Belfast, has been bought by a joint venture of New River Retail and the American firm PIMCO. Last month the partnership submitted a failed bid for a portfolio of Northern Ireland loans owned by the National Asset Management Agency, but is now known to have acquired two retail properties from the Ulster Bank sale — Priory Meadow in Hastings and The Avenue in Newton Mearns — paying out at least £140m for all three.
It’s not sure exactly how much control both men have retained in the 353,706sq ft Foyleside in Londonderry and the 317,649sq ft Forestside at Newtonbreda. Both sites have been sold to venture capitalists, Kildare Partners, for a joint price of £130m. The private equity organisation has a reputation for targeting distressed real estate and is one of Cheever and McGuckian’s backers.
The borrowings on all the shopping centres represent one of Ulster Bank’s largest remaining property exposures with the 2006 purchase of the Fosse Shopping Park for £360m its biggest single loan deal.
