InfraRed cashes in on Clayton Square turnaround

InfraRed Capital Partners has sold the 140,000 sq ft Clayton Square Shopping Centre in Liverpool to Rockspring’s UK Value 2 Fund for £38.4m less than three years after acquiring the asset for £13.5m.

Infrared acquired the city centre mall from Land Securities in April 2013. The new owner spent £3m refurbishing and reconfiguring the centre to create larger units and tackle void space.

InfraRed said in a statement today: “The dramatic transformation, involving the conversion of a redundant ground floor mall into retail units and the removal or conversion to other uses of unlettable first floor retail accommodation, led to Clayton Square being awarded the 2015 BCSC Gold Award for Refurbishment and/or Extension under £5m.”

Existing anchor tenant Boots committed to a new long-term lease at the property in a new-look and enlarged 55,000 sq ft store.

New tenants include supermarket Morrisons, bar chain Wildwood, clothing retailer Peacocks and Easygym. Leases were re-geared with EE and Clas Ohlson.

Vacancy rates dropped from 25% on acquisition to 2% and the average unexpired lease length has increased from three years to seven years.

Keith Butcher, director of real estate at InfraRed, said: “We acquired Clayton Square in April 2013 and are delighted to have delivered our ambitious plans to transform and regenerate a tired and failing 1980s shopping centre into a vibrant mixed-use “high street” development fronting three of Liverpool’s prime retail streets and in the process to be able to satisfy Boots’ decade long property requirement for the city”.

InfraRed acquired the larger St Johns shopping centre opposite Clayton Square in 2012, also from Land Securities, and last year marketed it for sale but no buyer was found.

Strutt & Parker advised InfraRed on the sale, with legal advice provided by Olswang and Osborne Clarke. Throughout InfraRed’s ownership, Hark Group and Munroe K have provided asset manager and managing agent services respectively.