Agents appointed to sell Trafford Centre

Administrators for the Greater Manchester shopping centre’s parent Intu Properties have selected CBRE to market the asset for sale for an undisclosed asking price.

Intu’s administrators at professional services firm KPMG also appointed PJT Partners as mergers and acquisitions advisor for the Trafford Centre sale process, which is expected to generate substantial levels of investor interest in the UK and globally.

CBRE and PJT Partners will work closely with the directors of the special purpose vehicle that owns and manages the Trafford Centre, as well as the property’s lenders and administrators, to maximise value for the asset.

Intu last valued the mall publicly at close to £1.7bn, but analysts reportedly expect it to be sold for a sum at least 20% less than this given the current uncertain retail climate – even though assets of the centre’s lot size do not come to the market often.

A spokesperson for KPMG said: “All parties are working constructively together to maximise value for this highly attractive asset.”

The 2.2m sq ft shopping mall in Trafford was built in the late 1990s by regional landowner the Peel Group and opened to the public in 1998.

In 2011, Peel sold the Trafford Centre to Capital Shopping Centres, which later rebranded as Intu Properties, for £1.6bn – one of the largest real estate acquisitions in British history and the biggest European property deal of that year.

The group retained a 24.6% stake in Intu, which collapsed into administration on 26 June this year after failing to strike a deal with lenders to pay down an estimated £4.5bn in debt.

However, the Trafford Centre has continued to operate throughout the administration process, as it is owned as an independent SPV in the same way as Intu’s other 16 shopping centres across the UK.

Peel has been rumoured to be interested in buying back the property but has so far declined to comment on any potential acquisition. The group is soon to be moving out of its longstanding headquarters within the Trafford Centre, Place North West revealed earlier this month.

PJT had been advising – before Intu’s administration – the Trafford Centre’s largest lender, Canadian pension fund CPP Investments, which in 2017 provided £250m of debt financing towards Intu Properties secured against the mall, with a maturity date of 2022.

 

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