Belfast Telegraph

Newry site with a new Tesco store could fetch £27m from buyer


A recently-opened Tesco Extra in Newry has gone on sale with an asking price of £27.3m.

The supermarket on Downshire Road on the edge of the city opened in May and is described by the property selling agents as the dominant supermarket in the area.

Now developer Turkington Holdings has put the property on the market with institutional buyers such as pension funds expected to snap it up.

The sale of the Co Down Tesco stands out as one of the causes for celebration amid a commercial property market which has endured a difficult six months, according to CBRE, which is selling the property.

The 93,000 sq ft building, which includes a car park with 531 spaces, is let to Tesco for 25 years at an income of around £1.6m per year.

There is expected to be considerable interest in the Newry superstore, considering the appetite of institutions across the UK for prime retail investments in Northern Ireland.

CBRE said: "Newry has a reputation as one of the best provincial shopping locations in Ireland, attracting large numbers of shoppers from both Northern Ireland and the Republic of Ireland."

Commenting on CBRE's mid-year report, Belfast managing director Brian Lavery said: "The position is beginning to improve and in the last month, we have had a number of prime assets coming onto the market to include Tesco superstores in Newry and Craigavon and two Royal Bank of Scotland (RBS) sale and leasebacks in Belfast."

The latest mid-year report revealed that activity levels were showing signs of an increase in activity across the investment and occupier markets.

The report describes current activity in the office sector in Belfast as "relatively small" but welcomed Nama's intention to provide £15m to bring about the completion of both Lanyon Plaza and The Soloist Building at Lanyon Place.

Nama was also hailed for helping the Horatio Group reopen six of Botanic Inns' pubs after it went into administration earlier this year.

Further sales, like that of the former Scottish Mutual Building in Donegall Square South in Belfast, Ulster Bank offices at Donegall Square East and Danesfort on the Stranmillis Road in Belfast for guiding prices of £19.4m and £8m respectively, are among the positive signs highlighted by CBRE.