A shopping centre in Scotland has been sold for less than the average price of a house in London, as stores across Britain struggle to survive.
In what The Guardian calls “the latest sign of the crisis in UK retail”, The Postings mall, in the Fife town of Kirkcaldy, was snapped up for £310,000 by an unnamed buyer who bid by phone at an auction on Tuesday. A total of 14 of the 21 lots inside the building are empty, and leases on the occupied units are due to expire within two years.
The selling price is around 35% less than the cost of the average property in the English capital, and is “barely double what the shopping centre currently generates in rent”, according to Bloomberg.
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The mall - which includes a 299-space car park - was put up for auction with a reserve price of just £1, by a fund managed by Columbia Threadneedle Investments.
Tesco previously occupied a unit in The Postings, which opened in 1981 and cost more than £4m to build. But the supermarket chain closed the outlet in 2015, since when multiple retailers have pulled out of the town or shut down, The Times reports.
This week saw the closure of Kirkcaldy’s branch of Marks and Spencer, after 80 years of trading, adds the BBC.
Neil Crooks, convenor of Fife Council’s Kirkcaldy Area Committee, said the sale of The Postings followed two years of discussions about the centre’s long-term future with owner Threadneedle.
“Across the UK, town centres are facing persistent and serious challenges as consumer behaviour and economic changes cause difficulties in filling retail units and higher vacancy rates,” Crooks added.
Nevertheless, the mall sale was described as a success by George Walker, a partner and auctioneer at Allsop, which handled the sale.
“We have never had this much interest in a lot,” he said. “This centre is largely vacant and is an old piece of real estate where shopping habits have changed. It costs about £20,000 a year to own and our clients bought it to earn money.”
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