Hammerson’s disposal of its stake in retail outlet group Value Retail is a long-awaited step in the REIT’s turnaround – but is also a notable deal on the other side of table, not least as it has been sealed just weeks after buyer L Catterton brought in a new partner to spearhead European expansion.
L Catterton is a US-based consumer-focused investment firm that brings together private equity firm Catterton and luxury goods business LVMH. It has some $34bn (£26bn) of assets under management.
Its real estate deals have focused on mixed-use projects anchored by luxury retail, with a target equity investment range of $25m-$120m. Its latest property-focused fund is L Catterton Real Estate III.
L Catterton’s existing real estate portfolio includes luxury retail, office and residential properties such as the Hong Kong Central, an 8,000 sq ft former Hermes store; the mixed-use Royalmount scheme in Montreal (3.5m sq ft); California’s South Bay Galleria (970,000 sq ft); the Amazing Brentwood in Vancouver (1.5m sq ft); and Miami Design District (970,000 sq ft).
The Value Retail deal marks a significant addition to the portfolio, including the Bicester Collection of 12 luxury outlet shopping villages in Europe and China, including the famous Bicester Village in Oxfordshire. According to analysis of public information on the group’s holdings, it would mark a first real estate asset held in the UK for the firm. Bicester Village is the UK’s biggest premier destination with a growing international reach, and the acquisition could form a closer tie with LVMH-owned brands are already long-time partners with the Bicester Collection.
While Hammerson described the £600m sale of the company’s stake in Value Retail as allowing it to offload an “overweight, non-controlling and yield-dilutive” holding, L Catterton global co-chief executive Michael Chu said he saw the business as “well positioned for growth and continued success”.
“We have deep experience investing in luxury retail, and we are eager to leverage our operational expertise and global network of established relationships to partner with Value Retail and propel the business forward,” he said.
Earlier this month, L Catterton named Miray Topay as partner and head of the firm’s London office. Topay joined from Bain Capital, where she was a London partner and co-led the firm’s consumer investment strategy across Europe. At L Catterton she is working alongside European managing partner Luigi Feola to capitalise on what the company calls “strong opportunities in Europe”.
“Europe plays an important role in our global strategy, and [Topay’s] extensive network, strong track record, and intimate understanding of the consumer investment landscape – both in Europe and globally – make Miray a remarkable addition to our team,” Chu said at the time.
Recent European investments for the firm have included Tod’s Group, an Italian luxury fashion house; KIKO Milano, a cosmetics brand; and AmaWaterways, a luxury river cruise line.
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