Dudley’s giant Merry Hill Shopping Centre is in line for a major makeover in a bid to boost trade after property group Intu bought a 50 per cent stake for more than £400 million.
Intu agreed to purchase the half-share in the centre from former owner, Westfield, with the other half of the business remaining with Australian investment body QIC.
The property group said Merry Hill was currently ‘significantly underperforming’ because of its retail mix.
The Merry Hill acquisition is part of a £867.8 million deal which also includes the takeover of Derby’s Westfield centre and Sprucefield retail park in Northern Ireland.
Merry Hill was developed in the late 1980s. It has 1.4 million sq ft over two retail levels with 214 shop units and a further 300,000 sq ft of other adjacent retail space generating net annual rent of almost £55 million.
About 25 million shoppers are attracted to the centre, which is anchored by Marks & Spencer, Debenhams, Bhs, Primark, Sainsbury’s, Next and Asda, each year. The centre currently has an occupancy of about 96 per cent.
Westfield holds its interest in Merry Hill jointly with QIC, which will retain its 50 per cent holding after the acquisition.
Intu will be appointed as asset and development manager for centre and it will be rebranded as intu Merry Hill.
The group agreed to pay £407.7 million for the stake in Merry Hill.
Intu chief executive David Fischel said: “The transaction is a rare and attractive opportunity to acquire a further two prime shopping centres in line with our strategy to focus on the UK’s largest and most successful destinations.
“The acquisition strengthens Intu’s position as the leading owner, developer and manager of prime UK shopping centres filling in gaps in our national coverage and extending the footprint of our nationwide consumer facing brand and digital strategy.
“We are delighted to establish a partnership with QIC, a major global investor, at Merry Hill.”
Intu already owns The Potteries centre in Stoke and the Victoria and Broadmarsh centres in Nottingham.
It also agreed to pay Westfield £390.3 million for its Derby centre and £69.8 million for the Sprucefield retail park.
Westfield also owns centres in Shepherds Bush and Stratford City in London.