Intu sells 50% of Norwich centre

LASALLE Investment Management, acting on behalf of Greater Manchester Pension Fund and West Yorkshire Pension Fund, is to acquire a 50 percent interest in the intu Chapelfield shopping centre in Norwich in the UK for £148 million (R2.7 billion).

It has agreed to acquire the stake from intu Properties, the listed leading owner, manager and developer of UK malls with a growing presence in Spain.

Yesterday intu said that LaSalle, acting on behalf of the two pension funds, would form a partnership with intu Properties to jointly own intu Chapelfield.

It said the purchase price for the 50 percent interest in the centre was in line with the £296m valuation at end-December for the entire centre and a small discount to the £305m valuation at end-June. The net rental income of the property was £15.5m in the year to December.

Chief executive of intu Properties, David Fischel, said the transaction advanced intu’s stated strategy of introducing investment partners to its assets and recycling capital into its UK development pipeline. Fischel said intu would use the net proceeds of the transaction to repay debt on its revolving credit facility and invest in its committed development pipeline.

In a trading update for the five months to November, Fischel said the group expected to achieve a third year of positive like-for-like net rental income as it continued to attract well-known global and national brands. He said there was strong tenant demand in the period, with 73 long-term leases agreed. Shares in intu rose 0.57 percent on the JSE to close at R40.45.