Ashley lining up deal for Dundee’s Overgate Centre
Retail tycoon Mike Ashley is poised for a £100 million spending spree on shopping centres including the Overgate in Dundee amid hopes that the fall-out in the sector is stabilising.
Mr Ashley’s Frasers Group is making its first foray into shopping malls and is in advanced talks to buy the Overgate for £30m, along with The Mall in Luton in a £70m deal.
Frasers is said to be timig its acquisitions to coincide with hollowed-out valuations and an expected upturn.
A deal for the Overgate centre would leave a big loss for its owner Legal & General, which paid Landsec £125m nine years ago. Sports Direct and USC both operate stores in the centre.
Mr Ashley is known to strike a hard bargain and as such sources say there is no guarantee a deal will be done.
The Frasers group is now led by Mr Ashley’s son-in-law Michael Murray and has taken stakes in Hugo Boss, and in the online retailers Asos and N Brown.
A revaluation of commercial property, unveiled in the autumn statement, is lifting some of the burden of business rates, which retailers said hurt them disproportionately.
There has also been a steep decline in rents on bricks and mortar retailing, while some landlords have agreed to deals that are based on a proportion of turnover.