Hermes Real Estate and Westfield could rethink the sale of their CastleCourt shopping centre in Belfast after bids came in at almost 20% below the asking price.
Parties including Catalyst Capital with Blackstone and Land Securities are understood to have tabled bids of around £140m for the 330,000 sq ft mall.
The owners instructed Savills to seek offers of £171m – a 7.5% yield – in June. They are expected to make a decision on the sale imminently.
One investor said: “CastleCourt is highly likely to get pulled because the bids are so far off aspirations. The vendors might be on the punchy side with pricing. At that lot size, there is always a small pool of people who will go to Northern Ireland and Belfast. It’s a big bet, even for Land Securities.”
Another added: “CastleCourt has a huge amount of expiries, is a big lot size and there is the Northern Ireland factor. Investors think it is really quite hard to work. However, there is a very high propensity to spend from consumers there.”
If the mall is pulled from the market, it will be the second time a sale has failed. Hermes had tried to sell its 50% stake in 2007 but a deal with William Ewart Properties collapsed.
Savills is advising Hermes and Westfield; Lunson Mitchenall is acting for Catalyst and Blackstone; Franc Warwick is advising LandSec. All parties declined to comment.
annabel.dixon@estatesgazette.com
