An entire shopping centre in Wales has sold for less than the price of an average family home in London in the latest sign of a crisis in retail.
The troubled Kingsway Shopping Centre in Newport, Gwent, went for £615,000 – nearly £400,000 below its guide price weeks after going into receivership.
The city centre site – which houses a Starbucks and formerly a Wilko – was put on the market after its previous leasehold owners were placed into liquidation due to financial difficulties.
The leasehold for the centre was now been sold to an unnamed buyer for well below its £1m guide price.
Meanwhile the average London house price is now a staggering £685,200, Rightmove revealed earlier this year.
The troubled Kingsway Shopping Centre in Newport, Gwent, went for £615,000 – nearly £400,000 below its guide price weeks after going into receivership
Bargain shop Wilko, which had a premises in Kingsway, announced last month that all of its 400 stores would close for good
In May the shopping centre was put into property receivership and in August liquidators were appointed.
Jemma McAndrew, receiver and partner at Cushman & Wakefield, the difficulties for the Kingsway ‘reflected changes that occurred in the retail sector over the past few years’.
‘By nature of the retail environment at the moment running shopping centres and enticing tenants requires a significant injection of capital,’ she said.
‘Any new owner is going to need the cooperation of the council in respect of a grace period on the head rent in some shape or form. The asset’s income profile will be challenged even more with Wilko leaving.’
A spokesman for the council has said it will ‘work with any new developer to ensure ongoing viability’ and has ‘offered a range of business rate relief to retailers in the city centre and will work with any developers to ensure ongoing viability’.
The city centre site – which houses a Starbucks and a Sainsbury’s – was put on the market after its previous leasehold owners were placed into liquidation
The retail sector has been hit hard in recent years by the cost of living crisis, with rising overheads and faltering customer spending forcing a number of high street giants to shutter.
Bargain shop Wilko, which had a premises in Kingsway, announced last month that all of its 400 stores would close for good.
Administrators at PwC had agreed a £13 deal to sell 51 Wilko stores to B&M and Poundland snapped up around 71 shops.
But a buyer couldn’t be found for the entire business and it has since announced that all shops will close in the next few weeks.
