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The Trafford Centre has been purchased by a property investment company
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A Canadian property investor, CPPIB, has become the new owner of the Trafford Centre.
Canada Pension Plan Investment Board (CPP Investments) is headquartered in Toronto and has now acquired ownership of the shopping centre.
The firm loaned £250m to the previous owner Intu back in 2017. Intu collapsed into administration under the weight of £5b in debt earlier this year.
The Trafford Centre was hard hit by the coronavirus pandemic, with many retail tenants going bust or unable to pay rent.
The MEN reports that CPPIB was reportedly unwilling to let Intu use the security of the Trafford Centre to gain further credit with its banks, ultimately leading to the company’s collapse.
The news comes after the announcement last month that Manchester-based CBRE Group and international firm Savills were managing ‘the centre and day to day operations’.
Now, CPPIB has acquired sole ownership of the Trafford Centre.
The company said in a press release: “In June 2020, intu was placed into administration and a sale process was initiated for the Trafford Centre, however, no viable bids were received.
“As the principal secured creditor of ITCG with security over the equity interest in the Trafford Centre, in the absence of alternative sources of funding and the unsuccessful sale process, CPPIB Credit has exercised its rights to acquire the shares in ITCG and the ownership of the Trafford Centre.”
Despite losses of £704m in 2019, the new owners remain optimistic for the long-term prospects.
Geoff Souter, Managing Director, Head of Real Assets Credit, CPPIB Credit said: “The Trafford Centre is one of the UK’s top five shopping centres, welcoming more than 30 million shoppers annually, and counts many leading global retailers among its occupiers.
“While conditions for retail in 2020 have been very challenging, we are able to take a long-term view and believe that, with strategic management and investment, the Trafford Centre has strong prospects.
“An immediate priority is to support the Trafford Centre’s management, ensuring continued optimal operation of the Trafford Centre, and to appoint a long-term expert operating partner.”
They also said they would ‘evaluate the Trafford Centre’s complex capital structure to ensure it supports the return to long-term viability.’
CPP is a well-established investor in UK shopping centres, with investments in London’s Westfield Stratford, Birmingham’s Bullring and Grand Central.