Orchard Street acquires remaining shares in St Catherine's Walk, Carmarthen and B & Q Stevenage

Orchard Street Investment Management, the specialist commercial property investment manager, has acquired, on behalf of St James’s Place Wealth Management, the remaining 50% freehold interests that it did not already own in St Catherine’s Walk shopping centre in Carmarthen and a B&Q retail warehouse in Stevenage for a total consideration of £40.7 million. The vendors are funds managed by Scottish Widows Investment Partnership (SWIP).

SWIP’s 50% stake in St Catherine’s Walk was acquired by Orchard Street for £26.5 million, reflecting a net equivalent yield of 6.28%. A major 268,000 sq ft regional shopping centre, St Catherine’s Walk is let to a strong line up of major retailers including Debenhams, Topshop, Next, Republic, New Look and Fat Face.

The B&Q retail warehouse in Stevenage was acquired for £14.2 million, reflecting a net initial yield of 6.32%. The two storey unit providing 133,000 sq ft is currently let to B&Q at a rent of £14.25 per sq ft for a further 16 years.

Phillip Rodger, Partner at Orchard Street Investment Management, commented:

"When Orchard Street took over the mandate to manage £800 million of property funds on behalf of St James’s Place Wealth Management, we set out to reduce the cash weighting in the funds and to increase the exposure to strong retail assets. Acquiring the full 100% of the freehold of two quality retail assets in which St James’s Place already owned a 50% stake, we have taken a significant step in implementing this strategy and generating income for investors in the St James’s Place funds."

Nick Ireland, Investment Director – Real Estate, SWIP, commented: "The sale of the interests in these two properties was in line with the fund strategy to reduce exposure to jointly owned assets and enables the fund to recycle the capital for alternative uses."