Their need

LM advised the asset managers/special servicers regarding the debt on a portfolio of three shopping centres. The assets are geographically distinct, located in Loughborough, King’s Lynn, and Dunfermline.

Our pre-marketing advice involved formulating a strategy to determine the optimum timing to market the assets, considering a mixed profile of tenants, income, and expiry profiles. Our client intended on selling the entire portfolio; however, we identified that the assets would appeal to different groups of buyers. As a result, we targeted different potential purchasers for the individual assets and broader portfolio buyers for all three assets.

Our approach and thinking

Before marketing the assets, detailed modelling was undertaken alongside a thorough understanding of each asset and its potential upsides and negatives. This involved engagement with the letting and managing agents to ensure we were fully briefed before developing and delivering market presentations.

All the assets were secondary shopping centres that had experienced dramatic falls in income and value over the previous ten years. Our positioning objective was to demonstrate the yield was attractive enough, with sufficient upside and critical mass to appeal to professional, established buyers.

Joint results

Following a comprehensive marketing campaign, involving approxiamtely thirty presentations, our team answered detailed queries on each asset and persuaded buyers to inspect the assets before bidding to be taken seriously. This process was complemented by close monitoring of the data site created for the sale. Weekly meetings were held with our clients to review interest levels, and after eight weeks, bids were invited.

We received bids on both an individual and a portfolio basis, with six parties shortlisted for a second round of bidding. After evaluating these, meetings were arranged with the most suitable parties, and one bidder was selected for all three assets. The capital receipt exceeded our initial advice due to bidding tensions among the top three parties.