British Land pays £240m for Plymouth mall

City A.M. Reporter
British Land, the second-biggest landlord by market value, has bought a mall in Plymouth for £240m to add to its growing retail portfolio.

The 425,000 square feet Drake Circus shopping centre was bought at a net initial yield of six percent, with the potential for income growth through asset management, the real estate investment trust said in a statement.

"We see significant potential to add value at Drake Circus over the coming years by leveraging our extensive asset management skills and retailer relationships," British Land chief executive Chris Grigg said.

Located in the middle of Plymouth city, the mall has a catchment area covering Devon and Cornwall and an annual footfall of nearly 19 million people, and is anchored by tenants including Primark, Marks & Spencer and Next.

Real estate investors have been showing new interest in UK malls, which they expect have hit a bottom in capital values and rents, and are set to rise as the economy stages a tentative recovery.