(Image: SARAH CALDECOTT)
A property giant has agreed to buy Gateshead’s Metrocentre in a deal worth more than £500 million.
London-based Landsec has agreed to buy 100 per cent of the Metrocentre from Tynehawk Holdings (Jersey) Limited for £516 million, ending months of speculation over its future.
Landsec is thought to have beaten Mike Ashley’s Frasers Group to the retail and leisure complex, which has effectively been owned by Intu’s former lenders since the operator collapsed in 2020.
Frasers Group, which owns Sports Direct and Flannels, was among the parties reported to have competed for the centre.
Landsec said the Metrocentre attracts more than 16 million visitors a year and generates around £650 million in retail sales.
The centre has 282 stores across 1.86 million sq ft of retail space, including Apple, Sephora, Zara, M&S, Primark, Next, JD Sports and Lego.
The deal also includes the adjoining retail park, with 15 units.
Landsec said the Metrocentre is 95 per cent occupied and brings in around £41 million a year in rent.
The purchase is part of Landsec’s plan to invest a further £1 billion in major retail assets and strengthen its position among the UK’s biggest shopping-centre owners.
After the deal completes, Landsec will own three of the UK’s top 10 shopping centres and eight of the top 30.
Landsec chief executive Mark Allan called the deal a rare opportunity.
He said: "Our acquisition of Metrocentre represents a rare opportunity to obtain 100% control of a top-10 UK shopping centre.
"Metrocentre offers the scale, relevance and quality of catchment where demand from brands is highest, as they focus on fewer, bigger, better stores in the strongest locations."
He said the centre was well placed to benefit as retailers focus investment on their strongest locations.
"Metrocentre is exactly the type of destination where our market-leading platform can unlock further income and value growth," he said.
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The deal still needs bondholder approval and the dissolution of a legacy entity linked to the former Intu group.
Landsec expects the deal to complete by the end of October.
The announcement came as Landsec reported strong demand across its retail portfolio and forecast rental income growth through the current financial year.