Knight Frank Investment Management (KFIM), on behalf of Local Pensions Partnership Investments (LPPI) and advised by Montagu Evans, has sold the Princes Mead Shopping Centre site in Farnborough to Sovereign Housing Association for £17.6m reflecting an 8% net initial yield.
KFIM had secured support from the local authority through the planning pre-application process for a major residential-led redevelopment scheme. Sovereign was selected from a number of interested parties on the basis of price but also their track record in providing affordable housing.
The 7.77 acre site links Farnborough’s town centre and its main retail warehouse and
foodstore offering, including three core areas plus car parking: The Princes Mead Shopping Centre, a covered shopping centre providing 96,131sq ft of retail space focused on community and convenience tenants including Sports Direct, WH Smiths, Boots, Subway, Costa, Burger King and JD Sports; the Mead block, eight retail units extending to 20,698sq ft; and two recently developed retail warehouse units totalling 32,000sq ft let to Smyths Toys and Decathlon.
The site offers a significant residential development potential with a masterplan to deliver 350 new homes.
It sits at the heart of wider regeneration plans for Farnborough town centre, which are being brought forward by Rushmoor Borough Council and the Rushmoor Development Partnership. Their Civic Quarter masterplan incorporates a new leisure centre, civic hub and park, 1,000 new energy efficient homes, and new restaurant, food and beverage areas, with the redevelopment of Princes Mead able to be delivered before the first phase of these plans complete.
The deal sees KFIM and LPPI remain involved in the development project as overage partners.
John Styles, partner at Knight Frank Investment Management, said “Having worked with Rushmoor to establish support for a substantial residential-led development scheme we are delighted to have sold the site to Sovereign Housing Association. We are confident that Sovereign will take the project forward maximising the benefits, particularly in terms of affordable housing provision for Farnborough.”
Tom Titherington, chief investment and development officer at Sovereign Housing Association said: “We are delighted to have acquired our second shopping centre, with a view to the longer-term regeneration potential of the site. As our high streets evolve, it becomes increasingly important for forward-thinking housing associations such as Sovereign to take a proactive role in regenerating our town centres, supporting our customers through the delivery of affordable homes and the successful re-imagination of our high streets.”