Eric Wright buys Bolton retail units
The Lancashire-based property and construction group has completed a £4.1m acquisition of a retail parade on Newport Street from Lunar Retail Sarl.
The deal was agreed following “proactive” regeneration efforts by Bolton Council in the face of a challenging retail market, Eric Wright Group said.
Bolton has several major development projects in the pipeline at present, including Bolton Victoria Square, early-stage plans for an 18-acre ‘digital city’, and the £250m regeneration of Crompton Place Shopping Centre.
The Newport Street retail scheme generates a rental income of £550,000 a year, achieving a net initial yield of 12.5%, according to the developer. It is made up of 19 units and current tenants include Holland & Barrett, Game, Heron Frozen Foods and Shoe Zone.
The most recent arrival to the retail parade is discount health and beauty retailer Savers, which has leased 3,650 sq ft across two units.
Of the 19 units, 17 are occupied and Eric Wright reports a “healthy level of interest” in the two vacant units.
The acquisition comes six months after Eric Wright Group set out its plan to grow its property portfolio to £100m over the next five years.
A £3m redevelopment of Newport Street, including improvements to lighting, paving, seating and shop fronts, completed in December 2017, a year behind schedule.
Patrick Naylor, group portfolio manager for Eric Wright Group, said: “While some investors may be hesitant in acquiring retail assets in the current market, we believe it can still present a worthwhile opportunity to secure substantial rental income in areas where good investment in town centres exists and where there is a council in place that has adopted a proactive attitude to development and regeneration.
“We acquired the retail scheme at a competitive price and believe there are a number of asset management opportunities [at the site] that will help us further increase the value of this asset.”
Cushman & Wakefield advised EWG and Smith Price represented the vendor. Luxembourg-registered Lunar Retail Sarl is a joint venture between property fund M&M Real Estate and asset manager Apollo Global Real Estate, formed in 2013.