Wragges cashes in on shopping development

Wragge & Co’s property development team is advising on the development of the UK’s largest shopping park, expected to be worth more than £200m.

The 645,000sq ft Castlepoint development, previously known as the Hampshire Centre, is being built in Bournemouth and is due to open in autumn 2003. It is the largest park currently under construction and will be among the top 20 for size in the UK upon its completion.

Property partner Robert Caddick is leading the Wragges team and has been working on the project for six years, advising on all aspects of the development, including lettings, construction, planning and financing.

It will subsume an existing retail park, a fact that Caddick said complicated the deal. “It’s been a very complicated development. There are 40 different phases, which all had to be worked out. We also organised the bank facility and the building contracts for all the different stages and, more recently, have been doing the lettings and sorting out peripheral pockets of land around the edges,” he said.

The development is being managed through the medium of a limited partnership. Wragges’ long-term client Castlemore Securities formed the limited partnership, Castlepoint General Partner Limited, with Eagle Star Life Assurance. Standard Life Investments subsequently joined the venture by acquiring 50 per cent of Eagle Star’s interest in October 2001.

Anchor stores for the development include Marks & Spencer, J Sainsbury, Asda and B&Q Warehouse, alongside tenants such as Suits Direct, All Sports, Argos, Next, Boots, Gap and WHSmith.

Although it was an unusual option when first established more than a year ago, Caddick said that a limited partnership structure was chosen to enable Castlemore to actually invest its money into the development and so that Eagle Star, as a life fund, could gain some protection against development risk.

Caddick said: “It’s not for every situation. Limited partnerships are clearly more expensive and complicated to set up than some other forms of joint venture, but for big schemes they’re extremely attractive. It’s very tax-efficient for a gross fund and leaves the door open to bring in further investors at a later date, which is what happened with Standard Life.”