Haymarket Shopping Centre bought by Leicester City Council in surprise £9.9m deal
Leicester City Council is the new owner of the Haymarket Shopping Centre after the landmark indoor retail precinct was bought in a £9.9 million deal.
The local authority jumped in to secure the purchase shortly before the property was due to go on the market, it has emerged.
When it opened in June 1973 it was the country’s second shopping centre after the Bull Ring, in Birmingham.
But it has seen better days and falls firmly behind the Highcross in the city’s shopping venue picking order.
However, the Haymarket is still located in a prime city centre location next to the Clock Tower – between Charles Street, Belgrave Gate and Humberstone Gate – and it is currently home to 65 shopping units, including Matalan, B&M and Metro Bank, as well as Primark and TK Maxx.
City Mayor Sir Peter Soulsby said the council taking on the shopping centre would generate “much-needed income” in the wake of funding cuts from central government.
Announcing the purchase today, he said: “This council has invested in property in Leicester for many generations. Unlike many other councils, we are continuing to invest in our own city, and these assets make a huge contribution to its economic prosperity.
“The Haymarket Centre is a significant and important addition to our holdings. It also fits in with our wider regeneration of this area, where we have already invested in a new bus station, the pedestrianisation of surrounding streets, and a new link road to St Margaret’s bus station.”
Sir Peter added: “Government cuts to our revenue budget mean that like all councils we face very difficult spending decisions in the coming months.
“Using our capital budget in this way will generate much-needed income that we can spend on jobs and services, and will also give us the opportunity to have a positive impact on the city centre and the many businesses and jobs it provides.”
Prior to becoming its new owner, the city council was also a major tenant of the shopping centre – contributing 19 per cent of all revenues.
It paid rent for the Haymarket car park, Haymarket Theatre, Haymarket House (sub-let to Travelodge) and Haymarket Health (sexual health clinic).
A city council spokesperson said that funding for the purchase has come from a pot of £10 million set aside for capital investment within the council’s overall capital programme.
“This funding can only be spent on buying or improving buildings or highways, and not on running services,” they said.
“Savings from rent payments and the income generated from rent paid by other tenants will give the council an income to continue to support critical services.”
The shopping centre will be a major addition to the council’s Corporate Estate portfolio, which the council said is worth more than £112 million.
It includes buildings such as the Corn Exchange and Loseby Lane properties, along with 400 industrial units and 263 retail units – more than half of which are in neighbourhoods.
It also supports small businesses and start-ups by letting workspace at a low rent. However, the entire estate generates an annual income of more than £7m which the council uses to support services.
The council said it will now be looking into ways to improve the shopping centre and maximise its revenue.
“We will work with the current, experienced managing agents to operate the centre, whilst working on a medium to long-term plan looking at how its performance could be improved,” said the spokesperson.
Back in 2004, ING Real Estate Investment Management (UK) purchased the investment freehold in the 333,000 sq ft (30,936 sq m) retail space, on behalf of the Dutch international banking and financial services group, from Haymarket Properties Ltd for a reported £77.5 million.
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