British Land has made a significant acquisition by purchasing seven UK retail parks from Brookfield for £441 million.
- The acquisition will be partially funded through an equity placing, with an aim to raise approximately £300 million.
- CEO Simon Carter emphasises retail parks’ affordability, adaptability, and accessibility, describing them as integral to Britsh Land’s strategy.
- The seven retail parks are currently 99% occupied, highlighting their strong market performance and potential for revenue growth.
- This acquisition reflects the retail parks’ outsized performance in the UK real estate market since 2021.
British Land, a prominent FTSE 100 landlord, has expanded its portfolio with the purchase of seven UK retail parks from Brookfield, a Canadian investment giant, for the substantial sum of £441 million. This strategic acquisition aims to bolster British Land’s presence in the burgeoning retail park market.
To partially finance this transaction, British Land has announced a proposed equity placing, targeting a capital raise of around £300 million. This financial manoeuvre underscores the company’s commitment to maintaining robust liquidity while pursuing growth opportunities.
Chief Executive Officer Simon Carter articulated strong support for retail parks, citing their affordability due to lower rents, adaptability for facilitating click-and-collect services and last-mile delivery, and accessibility given their location on the outskirts of urban centres with ample parking. “We started buying [retail parks] in 2021 and since then they have been the best performing part of UK real estate,” Carter noted.
The newly acquired retail parks demonstrate impressive performance metrics, being 99% occupied. This high occupancy rate signals a promising outlook for increasing rental income, drawing a stark contrast with other segments of the commercial property sector, which have been challenged over recent years by rising interest rates.
British Land’s focus on retail parks is aligned with their proven track record of success in meeting the needs of multi-channel retailers. As noted by Carter, retail parks offer an ideal physical environment for fulfilling online orders, a feature that significantly enhances their attractiveness amid evolving retail dynamics.
British Land’s acquisition of seven retail parks from Brookfield solidifies its leadership in the thriving retail park sector.
