The sale of the 10-acre Central Retail Park to Manchester City Council, in partnership with Abu Dhabi United Group, has been confirmed, allowing the JV to move forward with more residential projects in the Ancoats area.
Central Retail Park is on Great Ancoats Street, a prime location at the edge of the Northern Quarter, near to New Islington. It has operated as a retail destination since the 1980s, but has suffered from a drop in footfall in recent years.
Due to its strategic location, Manchester City Council has been eyeing the site, previously owned by TH Real Estate, as suitable for residential development for a number of years.
The council asked its executive for permission to buy the park from TH Real Estate at its meeting in September, and the purchase was confirmed by TH and its agent CBRE in an announcement this morning.
According to a report to the September committee, the council will put in place a development framework and commercial plan, in partnership with Abu Dhabi United Group, delivering homes and mixed uses, potentially under the Manchester Life mantle.
TH Real Estate was granted planning permission in 2013 for a £40m scheme which included a 90,000 sq ft supermarket, cinema and smaller retail units with undercroft parking. Work on the project never began.
Then in 2016, TH proposed a refurbished offer “to bring the site up to modern standards”, and release half of the site for residential development and other uses, although no further action was taken.
While there was no detail on purchase price, or the number of units proposed on the site, previously the park has been valued at around £25m, and its size has been estimated to potentially support up to 1,500 homes if built in high density.
The council owns the freehold of the site, and TH has surrendered the leasehold.
Jamie Johnson, fund manager at TH Real Estate, commented: “The sale of Central Retail Park is in line with our fund’s strategic objectives to focus on strong performing retail assets. We are pleased to have secured a deal with the council that will greatly benefit the city. We remain committed to Manchester and will now focus our efforts and investment on Manchester Fort Shopping Park to ensure this remains one of the UK’s leading fashion parks.”
John Dunlop, director for the national land and development team at CBRE Manchester, added: “The sale is the culmination of over two years of intensive work by CBRE and the wider client team. The instruction has changed and developed constantly through its lifecycle, including part sale, sale of the whole, lease renegotiation and valuation management. The outcome represents a positive result for all parties on one of the city’s most strategic sites.”