Blackpool Shopping Centre up for sale

THE first of two expected major Cork shopping centre sell-offs by the privately-owned global investment firm Varde Partners has been confirmed.
Blackpool Shopping Centre up for sale

Blackpool Shopping Centre, retail park and offices — which had been developed by the Love family — goes to market this week, guiding €117 million, after last changing hands in a portfolio sale.

Market sources also expect Varde to similarly consider selling the Douglas Court Shopping Centre, another Shipton Group/Love family development which Varde also acquired in another portfolio sale about three years ago.

The sprawling Blackpool complex, anchored by Dunnes, which owns its own store, produces a net rental return of €7.38 million, and on the €117m-plus price guide via JLL and HWBC who’ve been managing it, a return of c 6% can be expected. Tenants include Aldi, Heatons, New Look, Next, and a Woodies DIY and garden centre.

Varde Partners acquired Cork’s northside’s largest retail complex the Blackpool Centre as part of the €171 million Project Acorn, which also included Clonmel’s Showgrounds development, plus the Millfield Shopping Centre in Balbriggan, when it was reported to have paid €30m over the asking price.

The 1993-founded, privately-owned Varde also bought the Douglas Court Shopping Centre across the city’s southside suburbs, one of two sizeable centres developed in Douglas by Clayton Love Jnr. It sold as part of the €160m Spectrum portfolio that comprised six national shopping centres and offices.

Also anchored by Dunnes, Douglas Court has over 50 retail units and 167,748 sq ft of retail space on a 13 acre site, with parking for 950 cars and scope to add a further 80,000 sq ft of development.

At the time of the Project Spectrum sale, Douglas Court generated rents of €3.9 million pa, about half of Blackpool’s return. Blackpool’s WAULT is about 6.13 years, and it is expected to be of interest to funds, international investors and those who’d seek to add further value. Since buying Blackpool nearly three years ago, Varde Partners undertook asset management initiatives, re-geared some leases, and filled vacancies and now has said it has decided to “sell the asset to a lower cost of capital investor who will no doubt continue with the other longer-term asset management opportunities”.

As Blackpool now arrives as a significant investment offer, all eyes are likely to turn to Douglas Court’s prospects, and it may be offered once Blackpool is secured.

Also changing hands in the past three years of post-crash retail recovery was Cork’s Wilton Shopping Centre, part of Nama’s Project Hazel, and acquired in 2015 by Clarendon Properties with hedge/investment fund York Capital.

That deal was reported at €70m with an income stream of €9m on a large site with further development scope. Anchor tenants are Penneys, and Tesco Extra, who own their own store. Wilton was developed in the 1970s by Clayton Love Jnr, and subsequent owners include IPFUT, Tesco, and Howard Holding/Joe O’Donovan, who propose a whole new redevelopment of the site in the western suburbs.

While there’d be investor interest in Wilton, should Clarendon/York Capital choose to offload it, Clarendon has since acquired a section of Cork city’s Merchant’s Quay Shopping Centre for redevelopment, as well as residential sites and a portion of CIE’s Horgan’s Quay for a major mixed use scheme of offices, hotel and build-to-let apartments.

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