Blackpool Council buys Houndshill Shopping Centre out of receivership

Blackpool Council has bought the Houndshill Shopping Centre for £47.6m – less than half of the price originally paid for it – after it was forced into receivership. The council said it has been in discussions for some time with BCC Eiffel, the previous owner of the centre and a subsidiary of South Africa-listed New Frontier Properties. The centre’s lender, Deutsche Pfandbriefbank, suffered a blow last week when the centre’s owner admitted it could not repay the outstanding £56.9m loan. Deutsche Pfandbriefbank sent a notice of acceleration to BCC Eiffel on 30 October but was notified that it was unable to settle its demand for repayment. BCC Eiffel was subsequently advised that Joint Law of Property Act receivers Mathew Nagle and Kevin Mersh were appointed to the centre, and had exchanged contracts to dispose it on behalf of the lender. However, the council stepped in and agreed to purchase the centre for less than half of the £105m price paid by BCC Eiffel in 2015. The council is considering an extension, with restaurants and a cinema. A spokesperson for Blackpool Council said: “This acquisition will deliver a significant financial return to the council but, more importantly, it will allow us to invest in a shopping centre that is fundamentally important to Blackpool’s future. “Moving the centre into council ownership will provide significant benefits to our town and our residents. At the same time, we have the potential to unlock up to £50m of investment in the town through the Future High Streets and Towns funds, which will undoubtedly give further momentum to the regeneration of the town centre.” HSBC holds the loans to New Frontier’s remaining two assets: the Cleveland Centre in Middlesbrough, and Coopers Square in Burton upon Trent. New Frontier Properties breached its banking covenants last year. To send feedback, e-mail pui-guan.man@egi.co.uk or tweet @PuiGuanM or @estatesgazette