Grimsby's House of Fraser store put up for sale for £12.75m
ON THE MARKET: The particulars for the sale process for House of Fraser's Grimsby store.
By Grimsby Telegraph | Posted: 26 Apr 2017
GRIMSBY’S House of Fraser store has hit the market with a cool £12.75 million price tag.
The property, 9-21 Victoria Street West, boasts 92,400 sq ft of floorspace arranged across five storeys, and is being offered as a freehold sale by KLM Retail. The thriving store is unaffected.
Not technically part of Freshney Place, although offering access to and from it, the sale is seen as a sign of confidence in the town.
Offering a yield of more than 7 per cent, and with the fashion-led department store in growth and signed up to occupy the prime site for another 22 years, it may well tempt a major corporate investor.
House of Fraser currently pays nearly £1 million a year to occupy the flagship site.
Chartered surveyor Rupert Guy, partner at KLM, said the sale had only come about because the institutional owner had just let another large department store in Chester to the same tenant, and wanted to “dilute exposure”.
The retail expert said: “It is a property which has 22 years remaining on a lease to a tenant that has been in that location for over 50 years, originally as the Binns department store.
“Freshney Place’s landlord has done a huge amount of work to improve the scheme and footfall, and is in a joint venture with the council to bring a cinema and leisure development in to the scheme.
“House of Fraser trades very well out of it and it will give someone a very healthy return pro rata to other investments out there. I would think it will appeal to another institutional investor, overseas investors, certainly perhaps people who have never been to Grimsby before.
“Grimsby is a thriving community very much in its own catchment. While it is en route to nowhere, when you do get there, you find it is doing very well indeed.
“We have plenty of interest.”
Details pulled together to market the store describe Grimsby as a “busy town and port” with a primary catchment of 256,000 people.
Grimsby town centre based chartered surveyor, Lawrence Brown, who heads up Scotts, anticipates another city-based transaction.
He said: “This shows some confidence in Grimsby. The brochure is very positive. I see it as being attractive to the right market. At the moment money is fairly cheap to borrow, and a pension fund that has a duty to provide a return will see it as a good opportunity. I can see it being fairly well sought after.”
The town's flagship department store was bought for £10.5 million in August 2009 by Development Securities, changing hands 13 months later for £13.1 million, to a pension fund managed by Rockspring Property Investment Managers.