The property value of Selfridges has significantly decreased, raising concerns about ongoing financial pressures.
- Selfridges’ property portfolio saw a reduction of £638.6 million, marking a 20.6% decrease from its previous value.
- Over £1.7 billion in loans are secured against Selfridges’ properties, with maturity looming in August 2025.
- The Saudi Public Investment Fund recently acquired a significant stake in Selfridges Group.
- The valuation downturn is attributed to external factors, including changing interest rates and market rents.
The value of Selfridges’ property portfolio, including the flagship Oxford Street location in London, has dropped by £638.6 million, a 20.6% decline as revealed by the retailer’s property holding company. This decrease forms a significant part of the company’s concerns regarding its financial outlook.
Selfridges has secured loans amounting to over £1.7 billion against its freehold properties. These loans are due to mature in August 2025, posing potential financial challenges as the due date approaches, unless refinancing strategies are effectively implemented.
Last week, a notable development occurred when Saudi Arabia’s Public Investment Fund acquired a 40% stake in the Selfridges Group. This group encompasses not only the Selfridges department store chain in the UK but also several stores in the Netherlands and Ireland.
The reduction in property value is primarily attributed to external market factors, notably including rising interest rates and prevailing market rent fluctuations. According to a company spokesperson, these factors have significantly influenced the recent valuation adjustments.
Historically, the ownership of Selfridges has undergone substantial changes. In 2021, the Weston family sold the Selfridges Group to Signa Holding and Central Group for approximately £4 billion. Recent financial instability led to a new auction where Saudi Arabia’s PIF emerged as a stakeholder. Meanwhile, Central was compelled to lend £98.1 million to fulfil existing financial commitments.
Selfridges’ current financial situation underscores the challenges faced by luxury retail in adapting to volatile market conditions.
