£70m deal for city centre building
A YORKSHIRE landmark which is being transformed into a major mixed-use scheme has been acquired for £70m.
The former Lewis’s and Allders department store building in Leeds has been acquired by Highcross from Capital and Counties.
The building, which is now known as Broad Gate, is being transformed into a 300,000 sq ft office and retail scheme.
When completed, it will provide 168,750 sq ft of Grade A office space and four large retail units.
The property will also provide the largest office floor plates in Leeds, at around 36,000 sq ft to 39,000 sq ft.
Richard Pellatt, a director at property fund manager Highcross, said a motivating factor for the deal was the strong demand for office space in the city’s centre and a dwindling supply.
Mr Pellat said: “Broad Gate and Toronto Square (in Leeds), which was acquired by Highcross in January this year, are among the few city centre office developments due to come on stream in 2009.
“With annual take-up of office space in Leeds averaging around 555,000 sq ft, of which 330,000 sq ft is Grade A, and only 75,000 sq ft prime space currently available in the city core, we will be meeting a significant need in the local market.”
Three of the retail units, which total 121,086 sq ft, are already pre-let to T K Maxx, Argos and Sainsbury’s, with one 32,715 sq ft unit remaining.
Broad Gate is located on the Headrow, which is being redeveloped with a new retail quarter planned by Hammerson and Town Centre Securities to the east of Broad Gate and a further scheme to the south by Caddick and Land Securities.
Savills acted for Highcross on the deal and Tudor Toone represented Capital and Counties.
Simon Lister, investment director at Savills in Leeds, said: “The purchase of Broad Gate marks a complex and sizeable investment by Highcross to obtain the largest single floor plate in Leeds, which is in an excellent location ideally placed for both rail and road access and the city centre amenities.
“With serious interest in the office accommodation and three of the four retail units already pre-let, demand for this prime scheme is already obvious.”
Savills’ office agency team in Leeds has been retained to advise on the lettings at the scheme alongside Colliers CRE.
Paul Fairhurst, head of Savills in Leeds, added: “With our research showing no marked slowdown in occupational demand over the first half of the year and with in excess of 300,000 sq ft of new enquiries over the past quarter for city centre space , we expect the high quality space at Broad Gate to prove particularly popular.”
