What’s next for the Trafford Centre as it goes up for auction

Two months after filing for administration, Intu Trafford Centre is seeking a buyer for the £1.7 billion shopping centre. 

The Trafford Centre is set to be put up for auction after pressure from its biggest lender. 

It comes two months after the parent company, Intu Properties, collapsed into administration. The board of the entity which controls the Trafford Centre has appointed PJT Partners, the investment bank, and the property agent CBRE to market the site, according to Sky News.

The Trafford Centre was last publicly valued by Intu at just under £1.7billion, however, analysts are expected it to be sold for at least 20% less than that. 

In a statement issued to Sky News, a spokesperson for the joint administrators of Intu properties said: “All parties are working constructively together to maximise value for this highly attractive asset.”

PJT is said to be have been advising the Trafford Centre’s single-biggest lender of capital, Canada Pension Plan Investment Board (CPPIB), for some time before the administrators were called in back in July. 

CPPIB is one of the world’s largest pension funds and reportedly wants a quick sale of the Trafford Centre. 

Appointing advisors is set to kick off a formal sale process, and is also expected to attract the property tycoon who sold the Trafford Centre to Intu in 2011, John Whittaker, according to Sky News.

The auction will provide a crucial test to investors at a time when the Trafford Centre, like many retail outlets, has suffered due to the coronavirus pandemic.

Intu directly employs 3,000 people with a further 102,000 working in its shopping centres across the UK. There are a further 30,000 people employed in its supply chain.

The administrator, KPMG, appointed earlier this year, has secured funding to continue managing Intu’s portfolio for six months.

Property sources and insiders have said the Trafford Centre will attract substantial interest in the UK and international investments. One source added that ‘assets of Trafford’s quality and lot size do not come to market often’.

While we’ll have to wait a bit longer to discover the outcome of the auction, it’s good news for fans of the shopping centre and people who work there, as it looks unlikely it’ll have to close at this point.