Property firm quits retailing

Dec 30 2009 By Andrew Mernin

PROPERTY firm Segro today bowed out of the retail sector with the £26.9m sale of its stake in a shopping centre partnership with Tesco.

The firm’s 50% holding in the joint venture, which covers the Surrey Quays Shopping Centre in Rotherhithe, London and the Clifton Moor Retail Park in York, was bought by British Land.

Segro, which is behind some of the UK’s largest industrial estates, said it had been divesting its retail property interests since 2004 and today’s announcement completes its exit from retail property.

UK managing director Ian Sutcliffe said: ``These shopping centres were developed a number of years ago and do not represent the current focus of our business."

Segro, formerly known as Slough Estates, said the joint venture with Tesco was originally created in 1989 and the gross asset value of the holding was now around £174 million.

The deal marks the fifth joint venture between British Land and the supermarket giant.

Chris Grigg, British Land chief executive, said the firm was ``delighted" with the deal.

``These retail locations offer attractive opportunities for our asset management expertise to add value over the short and medium term," he said.

Both shopping centres feature a Tesco superstore.

The London-based site is arranged in a mall-style with shops including Boots, Currys and River Island, while the York scheme comprises of warehouse units for stores like Wickes and Pets at Home.