Investment in shopping centres to break £1bn mark this quarter

DIRECT investment into shopping centres is set to break the £1bn mark this quarter thanks to a flurry of deals, including Intu’s £250m acquisition of Milton Keynes’ Midsummer Place.

This marks a significant increase on the 2012 quarterly average of £600m and the five-year quarterly average of £570m, according to research by Jones Lang Lasalle.

The largest deal of the quarter was F&C Reit Asset Management’s acquisition of the Grosvenor Shopping Centre Fund for £254m last month.

Jones Lang said a continued lack of prime stock and competitive pricing was “driving investors up the risk curve”.

Adrian Peachey, head of UK retail capital markets said: “Reits (real estate investment trusts) in particular have actively returned to the market at the start of the year. There appears to be continued healthy demand for prime shopping centres and this quarter’s volumes demonstrate that appetite for best secondary is increasing.”

Property firms have also been shifting away from a pure retail offering and increasing their exposure to the leisure and eating-out sector, which are seen as being under less threat from the internet. Land Securities recently took control of X-Leisure, the owner of Xscape indoor ski slopes.

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