THE head of the investment trust that has bought the Sprucefield Retail Park has said the ship has sailed on a John Lewis store at the site.
Real estate investment trust NewRiver confirmed its £40 million acquisition on Monday.
It comes just five years after previous owners Intu paid £70m for the five massive units close to Lisburn. The 231,000 of retail space is home to Sainbury’s, Argos and B&Q, but it also include 18 acres of development land.
John Lewis was originally identified as the anchor tenant for a massive department store on the site in 2004. But protracted legal wrangling and the challenges facing the retail sector has resulted in the development plans for the site being downsized substantially.
Last year Intu submitted a revised development proposal with 13 smaller retail units and an 80-bed hotel.
Speaking yesterday, the chief executive of NewRiver, Allan Lockhart effectively ended any scope for John Lewis opening its first Northern Ireland store on the site.
“It’s very unlikely that we will come forward with a John Lewis store, I think that ship has definitely sailed.
“Department stores as a retailing subsector are struggling. Department store operators have too many stores and too much space, so we don’t really see that as the future solution to the development land.”
A spokesperson for John Lewis said yesterday: “We don't comment on speculation but we are always reviewing our physical estate presence.”
Mr Lockhart said while there is definitely potential for additional retail, he said NewRiver’s plans will likely feature leisure, food and beverage units, as well as a hotel.
He said the company will bring forward its own proposals for the 18 acres.
“We will work up our proposals in very close consultation with the local council to ensure that what we are going to deliver will be supported by the local communities who will hopefully be benefitting from what we do with that development land,” he said.
“The key thing is to make sure whatever we are providing is absolutely appropriate and it’s sustainable.”
Two of the units at Sprucefield Park are currently empty, but NewRiver says it has lined up a tenant for the former Currys/PC World store at the site. The fifth unit had been occupied by Toys ‘R’ Us until its collapse in 2018. It remains empty.
NewRiver already owns 33 shopping centre and 24 retail parks in the UK. In 2014 it bought the Abbey Centre complex in Newtownabbey for £62.6m.
Over the past five years, the company said it had invested close to £10m in the shopping centre.
Mr Lockhart said he believed the £40m price-tag for Sprucefield Park represented good value.
He said NewRiver have been tracking Intu’s efforts to sell off assets in a bid to cut its debts.
“We’ve always known this is a high quality asset with very good potential. But the key for us is to be very, very disciplined and patient.
“By adopting that approach, we believe we’ve been able to get this asset at a very attractive entry price.
Once completed, NewRiver said the acquisition will generate an additional £3.7m of annualised net property income for the investment trust.
Mr Lockhart said the company remains positive about the future of retail.
“We know there will be a strong requirement for physical stores,” he said.
But he anticipates retailer space will become smaller with fewer stores.
“We are in a market where there is too much retail space and too many stores. The solution to that is to take out some of that excess capacity of retail space and re-purpose it into other uses such as residential leisure, arts, culture, education, civic uses and medical uses.
“That’s where we see the future.”
