The retail parks, which total 176,500 m2 and are 99% occupied and anchored by major superstores, were purchased for £441 mln (€525 mln) from Canadian investment company Brookfield.

The deal, which reflects a net initial yield of 6.7%, was funded through equity placing along with existing cash and facilities.

The new assets have a passing rent of approximately £29.5 mln (€35.1 mln), a topped-up passing rent of around £31.9 mln (€38.0 mln), and an estimated rental value of about £30.4 mln (€36.2 mln). The weighted average unexpired lease term of the retail parks is 4.5 years to break and 5.9 years to expiry.

The retail parks include Elliott’s Field Shopping Park in Rugby; Central Retail Park in Falkirk; Wellington Retail Park in Waterlooville; Ravenhead Retail Park in St Helens, Cleveland Retail Park in Middlesbrough, Telford Forge Shopping Park in Telford and  Chilwell Retail Park in Nottingham.

With this acquisition, retail parks now make up 32% of British Land's total portfolio, up from 22% 18 months ago.

British Land CEO, Simon Carter, said: ‘The acquisition of this high-quality portfolio builds upon our market-leading position in retail parks. Parks remain the preferred format for retailers and we have deployed £711 mln (€847 mln) of capital into this sub-sector since April 1. These assets offer an attractive yield and strong rental growth prospects in line with our guidance of 3-5%. Combined with the proposed placing, they will be immediately earnings accretive and are expected to deliver a double-digit ungeared internal rate of return.’

In its trading update for the six months ended September 30th, the company anticipates underlying interim profit to be in the range of £142 mln (€169 mln) to £144 mln (€172 mln), representing a year-over-year increase of up to 1.4%. This growth is notable despite several properties entering development and the surrender of 1 Triton Square in the prior year.

Simon Carter added: ‘The broader business also continues to trade well with a good level of leasing in the period and cost discipline underpinning our profit performance. We expect portfolio values to be marginally up for the half year, with continued estimated rental value growth across the portfolio.’

British Land specializes in real estate sectors with robust operational fundamentals such as London campuses, retail parks, and London urban logistics. As of 31 March 2024, the property portfolio, which the company either owns or manages, is valued at £13.0 bn (€15 bn), with its share of the portfolio amounting to £8.7 bn (€10.4 bn).