Chelsfield shopping centre stake bears fruit
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Your support makes all the difference.THE MERRY HILL shopping centre in the West Midlands has increased in value by 45 per cent since Elliott Bernerd's Chelsfield took a 25 per cent stake last September.
A valuation by Chesterton, the chartered surveyor, to coincide with an increase in Chelsfield's stake to 50 per cent yesterday, put a price tag of pounds 185m on the development compared with pounds 128m when it first invested.
The rise in value means that the stake, which cost pounds 13.7m, is now worth more than pounds 38m. Analysts believe the latest acquisition was struck on the basis of a pounds 170m valuation of Merry Hill. At the time of Chelsfield's December flotation it was put in the books at pounds 155m.
Mr Bernerd said Merry Hill was one of only four comparable shopping centres in the country. Last year it attracted 22 million shoppers, had turnover of pounds 350m and was reported to have caused 70 per cent of town centre shops in Dudley to move out.
New planning guidance from John Gummer, the Environment Secretary, means that further large out-of-town retail developments are unlikely to gain consent, putting upward pressure on the remaining sites.
Chelsfield also announced the acquisition for pounds 35m of St Catherine's House, a 220,000 sq ft office building opposite the BBC's Bush House in Aldwych, central London.
The building, which provides rental income of pounds 4.4m a year from the Government's census department, was bought from the BBC's pension fund on an initial yield of 12.6 per cent.
Chelsfield's equal partner in the deal was an unnamed private German investor.
Mr Bernerd said that a planned redevelopment of the site behind its existing facade would increase net floor space from 152,000 to 190,000 sq ft.
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