Construction & Commercial Property News

Brexit halts £25million Gloucester King's Walk investment deal

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Written by: Daniel Chipperfield | Posted 15 August 2016 11:03

Brexit halts £25million Gloucester King's Walk investment deal

It was hailed as a £25million 'done deal' that would enhance the attraction of Gloucester city centre to visitors, shoppers and residents.

But now it has been revealed the sale of Kings Walk Shopping Centre never went ahead because of the UK's decision to leave the European Union in the referendum.

It was announced in June investment firm Vixcroft had bought the site from Aviva for around £20million and had pledged a further £5million investment in the site.

But Gloucestershire Live has learnt there was a 'Brexit clause' in the contract meaning the two companies are back at the drawing board with no certainty on whether new agreement will be made.

Daniel Carter, chief executive of Vixcroft, said there was still a 'strong chance' the deal would go through.

"There are issues that need to be resolved which we are working on," he said.

He didn't confirm a date but said they are "working towards completing the sale with Aviva."

"This is a common situation across the real estate market at the moment as a result of the EU decision," he added.

"Finance markets have gone through some turmoil but are showing signs of settling down.

"So it is by no means dead in the water but there is some turmoil and a lot of people being away on their holiday."

Describing itself as a company with a hands-on approach to turning around the income and value of 'problematic real estate assets' Vixcroft has in the last few months has undergone a programme of buying and upgrading several shopping centres across the UK.

But not only does the u-turn leave the future of the ageing centre in the balance, but it also poses questions over the wider major development of King's Quarter.

Vixcroft had expressed a strong willingness to work with the city council to plough significant funds into delivering the scheme which has recently been revised due to issues with viability.

In Gloucester 58 per cent of people voted to leave the EU in the June referendum.

Councillor Paul James, leader of Gloucester City Council and cabinet member for regeneration, said: "We all knew the outcome of the referendum has caused uncertainties in the finance market.

"Financial institutions are looking at their schemes they have promised to fund.

"But we are in regular contact with Vixcroft and very much hope that the purchase of Kings Walk and further investment goes ahead as planned."

Peter White, operations manager at Kings Walk Shopping Centre, said they did not wish comment other than to say they looked forward to working with the new landlord once the sale was completed.

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