Shopping centre owner and developer intu is planning a series of build-to-rent and hotel projects at existing shopping centre sites to boost development value and returns.
Intu revealed the fresh development strategy after suffering a tough year in the teeth of a deteriorating retail sector and booking a loss of more than £1.1bn due to downward property revaluations.
By intensify development at existing sites, intu estimates the potential for 5,000 flats and 600 hotel rooms.
Chief executive David Fischel Intu had significant opportunities within its portfolio for alternative uses of some of its available land.
“Our six major out-of-town centres comprise some 760 acres of land, of which less than 40% has buildings, multistorey car parks or distribution roads upon it, leaving 470 acres of surface car parks and other potentially developable land.
“The city centre locations also offer opportunities for intensification of uses.”
Initially, build-to-rent opportunities for 1,700 flats have been identified.
If fully developed, scheme would produce a yield of around 5% on total development costs, excluding land, of around £240m.
Fischel said: “The most advanced of these projects is at intu Lakeside, where we could deliver around 1,000 residential units.
“In addition to the residential and hotel opportunities, intu is exploring opportunities relating to offices and flexible working spaces to also generate attractive returns to its current rental income stream.
“Many of these options have a relatively low capital outlay, are quick to implement and take advantage of the current configuration of the centres,” said Fischel.
“All these opportunities, which are under active consideration, would create value directly but moreover would increase the overall attractiveness and catchment of the centres,” he added.
from Construction Enquirer http://www.constructionenquirer.com/2019/02/20/intu-to-build-flats-and-hotel-at-shopping-centres/
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