We bought Metquarter as this city is going places

Aug 15 2007 by Bill Gleeson, Liverpool Daily Post

THE new owner of Liverpool’s Metquarter shopping centre spoke yesterday about the reasons behind his company’s acquisition of the property.

Alanis Capital director Brian McCormack said he was attracted to the city because it “has a vibrancy missing from many other cities and towns across Europe”. He said: “We have been long-term believers in Liverpool as a city and we have watched the demographics improving every year.”

Alanis bought the 136,000 sq ft shopping centre on Whitechapel for £85m in a deal unveiled at the start of this week.

Mr McCormack said his mind was made up during a visit to the city last month, during which he became impressed by the way the nearby Liverpool One shopping development was shaping up. The £1bn Grosvernor scheme, currently under construction, will open its doors to shoppers next year.

Mr McCormack added: “It was an opportunity that couldn’t be bettered. It is close to Liverpool One, which we think will trade well, and has great tenants.”

Nor is Alanis unduly concerned by growing fears about the state of the UK property market, even though this week Metquarter vendor Milligan Developments said they felt now was the right time to sell because the market was turning. Milligan pointed to rising interest rates, concerns about high levels of consumer debts and the stock market falls of last week.

Mr McCormack said: “There has been a lot of pessimism about the UK retail market, but we don’t share it. From a macro-economic point of view, there are things that you could be pessimistic about, but Liverpool is only going one way.

“Next year it’s City of Culture which will have a huge effect for the long term. Employment is still strong. I don’t think things are as bad as people say they are.

“I walked through Liverpool and I see a vibrant, strong city going places.”

Alanis believes that the rent arrangements at Metquarter mean there is big scope to improve trading for its tenants and returns for itself.

The centre, opened in March last year, is home to 40 designer fashion outlets that include Armani, Hugo Boss and Flannels. The amount tenants pay in rent is a proportion of their turnover from trade at the centre, a factor that allows for the active management, or re-jigging, of the space they occupy. More successful traders can be allocated more space and those that are not doing so well can move to smaller units.

Mr McCormack continued: “We are concerned to make it as good as it can be. With turnover based rents there is a strong incentive to cooperate with tenants to increase the turnover at the centre as a whole.”

Alanis Capital is a property group set up by Dublin developer John McCormack two decades ago. Its total assets are euro1.5bn. An additional euro1.5bn-worth of property development is under way with a variety of joint venture partners. The group’s UK assets include the Royal Exchange retail centre in the City of London, acquired two years ago.

Mr McCormack added: “Met- quarter is our first investment in Liverpool and we are looking for- ward to it. And now we have de- cided to invest in Liverpool, we may well be making further investments there.”

billgleeson@dailypost.co.uk