Quadrant Estates has bought into a major West Midlands retail park in an off-market deal with Gallagher Developments.
Quadrant, with funding from US private equity firm Kohlberg Kravis Roberts, has bought phase one of Gallagher retail park, near junction 9 of the M6, from the Warwick-based group for circa £50m – a 5.75% yield.
Tenants at the 68,000 sq ft park include Next, TK Maxx, Mamas & Papas and Boots.
It comes after Quadrant teamed up with KKR to buy three retail parks in Oxford, Glasgow and Sunderland from Resolution Property for £112m – a 6.5% yield – last year. The 430,000 sq ft Project Tuscany Portfolio was KKR’s debut retail property purchase in Europe.
Gallagher pulled a proposed sale of the 200,000 sq ft Gallagher retail park to JP Morgan Asset Management in 2010 for £118m – a circa 6% yield. It has since sold 30,000 sq ft at the scheme to Cordea Savills for around £18m.
Guillaume Cassou, head of KKR Europe real estate, said KKR had strong experience in retail, having invested in Pets at Home and Alliance Boots.
Tony Gallagher, chairman of Gallagher added: “We have no doubt that this will be the first of many deals we do with KKR.”
Montagu Evans acted for Quadrant/KKR.
annabel.dixon@estatesgazette.com
