Henderson Global Investors has been given the go-ahead to proceed with the purchase of a portfolio of designer factory outlets for about £380m in what would be the largest UK property deal this year.

Henderson is proceeding with due diligence on the purchase of three designer outlets, including the flagship Cheshire Oaks centre, the Bridgend Designer Outlet in Wales and the Swindon Designer Outlet in Wiltshire.

EDITOR’S CHOICE Henderson in $5.5bn HK main asset deal - Oct-04HK property developers ready to cash in - Oct-12Henderson has fought off competition from a number of traditional property investors, which will give hope that the investment market is seeing a floor after almost a year of heavy declines in values and paralysis at the top end of the market.

The properties are expected to form the basis of a new retail property fund for Henderson. The fund manager is to buy the properties from limited partnerships comprising a number of UK institutions, including the BP pension fund, AXA and Morley Fund Management, as well as US real estate investor Liquid Realty. The vehicles that own the centres are closing in the next 18 months, prompting the sale. CB Richard Ellis is advising. All parties declined to comment. All three factory outlets are managed by McArthurGlen which is likely to remain as the manager should Henderson complete the deal.

Henderson already owns a number of factory outlets in Europe managed by McArthurGlen. The 350 shops in the centres include brands such as Calvin Klein, Burberry and Hugo Boss. Parties that bid for the deal included Moorfield, and Chester Properties in a joint venture with Apollo. The level of interest is described by property agents as a sign there is demand for good quality property in the UK, although the market is still being curtailed by the lack of debt.

About £7.6bn of deals were transacted in the first quarter, according to Property Data, down from £13.8bn in the same period last year. It was also down from the fourth-quarter total of £7.9bn. The largest deal in the period was a property swap, rather than cash purchase, between Great Portland Estates and the Crown Estate worth £357m. All other deals were under £300m.

●Topland, the London-based company run by Sol Zakay, has indicated interest in a $8bn (£4bn) portfolio of New York properties being sold by developer Harry Macklowe. The portfolio includes the General Motors Building, which had been given a price tag of about $3bn. Topland would not comment.

By Daniel Thomas, Property Correspondent

Published: April 22 2008

Copyright The Financial Times Limited 2008

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