Leading commercial property developer Ashfield Land has today announced UK Commercial Property Trust (UKCPT) has exchanged contracts to acquire its Regent Circus leisure development in Swindon for £40.5 million.
The price reflects a net initial yield of 4.86%, which is a record for this property investment market cycle and demonstrates the high level of institutional demand for the scheme.
Regent Circus is an exciting new 97,000 sq ft leisure development, which has transformed a neglected area of Swindon and is the catalyst for further regeneration of the Wiltshire town.
The impressive development is 94% pre-let and is anchored by a Morrisons supermarket and Cineworld six-screen all digital multiplex cinema. The Morrisons supermarket is due to open in November, followed by the leisure element which is expected to open in early 2015.
Ashfield Land director James Digby confirmed that contracts have been exchanged and that completion would take place at the end of the year once work on the development is completed.
The scheme will generate around £2.1m a year in rental income from leases with an average length of 20 years to occupiers with a sound covenant base.
The leisure landscape of the city will be revolutionised when the wraps are taken off Regent Circus. Swindon residents and visitors will, for the first time, have a wide range of well known high street restaurant chains to choose from, including Nando’s, Prezzo, Jimmy’s World Grill and Bar, Ask, Gourmet Burger Kitchen and Coal Grill & Bar.
In the past 12 months the development has risen from the five-acre former site of Swindon College, adjacent to Victoria Road and Eastcott Hill. Ashfield Land acquired the freehold in 2006 which facilitated the college’s relocation to a new £17 million campus.
Work on the entertainment complex started last summer. Residents and businesses agree that the development will be of huge economic benefit and will act as a catalyst to attract and retain visitors, competing with nearby towns and cities including Cirencester and Bristol
Hundreds of jobs are being created for local people. Morrisons recently announced it was recruiting 180 people for its new store, and there will be many more job opportunities at the eight restaurants and at Cineworld.
Andrew Fisher, managing director of Bristol-based Ashfield Land, said: “Right from the word go we were determined to create an exceptional new leisure destination right in the very heart of Swindon and I think the evidence is there for everyone to see that we have delivered everything we promised. It is an example of Ashfield Land’s vision and ability to buy sites with potential, and to create developments that add huge value to the surrounding area.”
He added: “Regent Circus is a truly inspiring development and will become the leisure focus of the town for many years to come. The high quality of the development and the exceptional location has attracted some of the UK’s leading restaurant brands and one of the top four supermarket operators.”
He added: “Interest in the units at the development accelerated once we started construction and it served to highlight the pent-up demand and the strength of the development. It is enormously satisfying to see the jigsaw almost complete and the transformation of this part of Swindon town centre on the brink of being realised.”
Ashfield Land is active throughout the UK and has several major developments in the pipeline.
Christopher Hill, chairman of UKCPT, said: “This acquisition supports the company’s ongoing investment strategy of acquiring assets that have the potential for both income and capital growth.”
JLL acted for Ashfield Land and BNP Paribas for UKCPT.
