Norwegian sovereign wealth fund to buy Sheffield shopping centre Meadowhall

Meadowhall, an indoor shopping centre located in Sheffield, South Yorkshire, and one of the top five shopping destinations in the UK, is to be fully operated by Norway’s sovereign wealth fund.

According to The Times, Norges, Norway’s 1.3 trillion pounds sovereign wealth fund, is in advanced talks to acquire British Land’s 50 per cent share of Meadowhall for approximately 363 million pounds, including debt.

Situated about 5 kilometres northeast of Sheffield city centre, the shopping centre attracts about 24 million visitors annually. It features 1.5 million sq ft of retail and leisure space, housing around 280 occupiers, including Marks & Spencer, Apple, Zara, Newbie, Neal’s Yard, Lego, Hugo Boss, Godiva, Flannels, and Tag Heuer.

The deal would value the extensive Sheffield shopping centre at 725 million pounds, equating to a yield of between 7 and 8 per cent, The Times said. Karsten Kallevig, chief investment officer for real estate at Norges Bank Investment Management (NBIM), the fund's manager, commented on the acquisition back in 2012, stating, “The purchase gives us exposure to one of the largest and most dominant shopping centres in the UK.”

British Land, which owns mixed-use commercial developments near London’s Liverpool Street and Paddington stations, plans to utilise the 150 million pounds proceeds from the Meadowhall sale to invest in retail parks, as reported by The Times. Norges owns significant property holdings in London’s West End, including a 25 per cent stake in The Crown Estate’s vast Regent Street portfolio and a 23.5 per cent stake in Shaftesbury Capital, the owner of Covent Garden. The sovereign wealth fund also co-owns the West One shopping centre, located next to Bond Street station, with British Land.