Miller Developments - Manchester, Swinton Shopping Centre

Date: 02 Dec 2004

Miller Developments, in a joint venture with London Merchant Securities, has purchased Swinton Shopping Centre in Manchester from Lathe Investments and GE Real Estate for £29.5 million, reflecting a net initial yield of 6.2%.

Located opposite Salford City Council's principal offices, in Salford, Manchester, Swinton Shopping Centre was purpose built in 1966 and refurbished between 1998 and 2001. The open mall shopping centre totals 181,500 sq ft (16,862 sq m) and comprises 81 retail units; a 10,000 sq ft (929 sq m) supermarket; 18,000 sq ft of offices; a snooker hall; 22 maisonettes; and a car park providing 500 spaces. The retail centre is fully let, with over 50% secured to national multiple retailers.

Lathe Investments originally acquired Swinton Shopping Centre on a long-leasehold interest in September 2000 on behalf of a limited partnership comprising its Redleaf II shopping centre fund, other Lathe investors and GE Real Estate. Over the next four years, Lathe acquired the freehold interest, undertook considerable leasing work and improved rental values from ITZA £38 to £45 per sq ft (£409 to £484 per sq m).

Miller and LMS have teamed up for the first time in a new joint venture, formed specifically to exploit the redevelopment and extension opportunities offered at Swinton. The new joint venture is proposing a regime of rent reviews and lease renewals which will reflect in an increased return of 7% by autumn 2005, followed by a number of retail extensions.

Phil Miller, chief executive of Miller Developments says: "This significant acquisition represents the first piece of business we have undertaken with our joint venture partners London Merchant Securities. This acquisition is a significant addition to our portfolio and brings Miller Developments' purchases this year to over £364.5 million."
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Ian Knight, managing director of Lathe, commented: "Our marketing produced strong interest in Swinton Shopping Centre and combined with our asset management results has produced an excellent return for our investors and partners.''

Miller and LMS were represented by DTZ and Colliers CRE while BCM acted for Lathe.

Swinton Shopping Centre, Manchester

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