HIG and lender Hermes have formally brought to market via consensual sale the Kennet Centre mall in the heart of Newbury as a major mixed-use redevelopment opportunity in a further example of how town-centre shopping centres are being repurposed with the support of local authorities in the face of the challenges facing retail.
HIG and Hermes have appointed CBRE to market the 243,813 sq ft of retail and leisure on six acres in the heart of the Berkshire town.
CBRE is marketing the centre as offering significant redevelopment potential for a variety of uses including residential. CBRE reports that West Berkshire is fully supportive of the redevelopment of the centre, with Newbury town centre the main focus for development in the district.
The principle of retail, leisure, residential, office and hotel are acceptable on the site as per the council’s 2016 Retail Study. The council’s town plan for 2019-2036 also recognises the town is largely saturated in terms of retail and there needs to be a focus on maintaining a mix of national multiples and local independents.
The scheme is anchored by a Vue cinema, Peacocks and Poundland. The 415-space multi-storey car park is let on a long lease to West Berkshire council.
Hermes financed private equity group HIG’s acquisition of two centres – Kennet and the Kirkgate Centre in Bradford – with a £42 million loan in 2016.
The vendors will be heartened by strong bidder appetite for another South East town centre shopping centre – the Nicholson’s centre in Maidenhead.
Hermes was the lender again at Nicholson’s which was sold out of receivership to Tikehau Capital and Rob Tincknell’s newly-formed Areli Real Estate earlier this year.
The pair are now in talks to buy three sites connected to the Nicholson’s Shopping Centre in Maidenhead from the Royal Borough of Windsor and Maidenhead as the partners build a major development opportunity in the town centre.
Tikehau and Areli bought the 190,000 sq ft centre out of receivership from BDO, advised by CBRE, in February of this year for a figure thought to be around £25m. The Nicholson’s Shopping Centre was previously owned by Vixcroft and hedge fund Cheyne Capital.