Landsec in talks to buy controlling stake in Bluewater - report

By

Sandra Halliday

Published
Nov 24, 2021

Property giant Landsec is reported to be in talks to buy a further 25% in the giant Kent shopping mall Bluewater with the price pitched at a bargain £200 million.

That’s according to real estate trade paper Property Week that said it would buy the stake from Lendlease and the purchase would give it a 55% controlling holding in the 1.8m sq ft location. The deal is said to be close to being finalised.

It would mean Bluewater’s shareholder line-up being reduced to five companies and that number could come down further with sources also saying Landsec would like to buy more of the business, potentially even taking full ownership.

The other owners of Bluewater include M&G Real Estate and Singapore sovereign wealth fund GIC (with a 17.5% stake each), Royal London Asset Management (7.5%) and Aberdeen Asset Management (2.5%).

Property Week said that £200 million is “far lower” than some reports suggested Lendlease was seeking for its stake and underlines the drop in retail values for even a super-mall like Bluewater in recent years.

Landsec previously bought 30% of Bluewater from Lendlease in 2014 for £656 million, which would have meant a valuation for the remaining 25% of £500 million+ if values had stayed buoyant. Lendlease was believed to be seeking at least £400 million for its remaining holding.

Landsec also bought the management rights for Bluewater and the land around it in 2014 and this land is believed to be key for its interest in the location. It reportedly plans to build homes and workspace there, in line with its mixed use strategy. This would, of course, also increase the numbers of shoppers living and working just on Bluewater’s doorstep.

Austria-based Lendlease had been the prime mover in developing Bluewater after being approached in 1994 by quarry operator Blue Circle to develop the quarry site. Europe’s largest mall finally opened in early 1999.

Although now only the fifth-largest mall in Britain, it still hosts 330 stores as well as cafés and restaurants, a 17-screen cinema and other experiences.

It has lost a number of fashion tenants in recent periods following strategy changes and business failures with closures in recent years including Oasis, Coast, Topshop/Topman, Miss Selfridges, and Missguided. But it remains one of the UK’s star malls and is a strong contender for any new openings. Zara opened its first UK new concept store there and Amazon more recently opened its UK 4-Star shop there. Many of M&S’s high-profile physical store initiatives debut at Bluewater too.