Junction One and the Outlet retail parks to be sold for £40m
Junction One as well as The Outlet go in joint deal
Junction One and The Outlet — two of Northern Ireland’s biggest shopping retail parks — have been sold, the Belfast Telegraph can reveal.
The sale is thought to be worth around £40m, making it one of the largest retail transactions of the last 12 months.
It’s understood a deal for both sites, which were marketed together, will be completed in the next few weeks.
They were put on the market for around £60m.
But it’s understood both are being sold for less than £40m. It’s believed Banbridge-based Lotus Group is acquiring both big name retail properties.
Lotus Group did not respond when it was contacted yesterday. The shopping park giants were being marketed by London-based property firm DTZ.
The agents did not wish to comment on the sale.
Both businesses — which each have around 50 stores — have faced their own problems over the years.
A massive retail site located just outside Antrim, Junction One was set up in 2004, boasting a range of big names, but in the latest set of published accounts for Junction One Ltd, it was valued at less than £8m. That's around a tenth of its value back in 2009.
The businesses at Junction One currently employ more than 1,000 staff.
It was being sold by the borrower with consent from Ulster Bank, along with administrators, who are representing previous shareholders.
Banbridge's The Outlet park was opened in 2007 at a cost of £70m.
The site counts a number of big name brands among its tenants, including Marks & Spencer, Gap Outlet and DKNY Jeans.
The Outlet was owned by West Register - a firm set up by Ulster Bank's parent company RBS in order to manage distressed property assets following the financial crisis.
Economist John Simpson said that while not achieving the asking price of around £60m was "not surprising", the disparity with the initial sale price was "slightly worrying".
"It's not surprising that they didn't get the original asking price, but it is slightly worrying that the gap is quite so large," he said.
"Northern Ireland commercial property wasn't subjected to the same inflation as houses, but it is now taking a severe adjustment," he added.
The imminent sale will be one of the largest commercial property deals in Northern Ireland in the last 12 months.
At the end of last year, Bangor shopping centre Bloomfield was sold for £54.5m to London investment firm Ellandi and Tristan Capital Partners.
The sale of the retail site was the fifth biggest deal involving a Northern Ireland business during 2015.
Other deals included Fairhill in Ballymena, which went for more than £45m, while the Showgrounds Retail Park in Omagh was sold for £27m.
Ellandi and Tristan Capital Partners also snapped up Enniskillen's Erneside Shopping Centre.
Mr Simpson said: "The important thing about a lot of these sales is they were previously in local ownership.
"But they are now being sold at very good prices for the buyers," he added.
"A lot of property assets are now being bought by outside investors, which is not necessarily bad, but at the moment it is a one-way flow."