THE Rushmere Shopping Centre in Craigavon was sold for £10.5 million below the asking price, with the administrators laying part of the blame at the feet of former UK Prime Minister Liz Truss and ex-Chancellor Kwasi Kwarteng.
The Co Armagh retail complex was placed on the market last August with a guide price of £57m after administrators took control of the asset in April 2022.
It was eventually bought by Killahoey Ltd in February 2023, a joint venture between Northern Ireland-based companies Sheephaven and May Street Capital, involving DV8 owner Ian McMahon.
But a new report published by the joint administrators from Grant Thornton, has revealed the shopping centre eventually changed hands for £46.5m after an earlier deal fell through.
The document, published by Companies House, states that heads of terms (HOTs) were originally agreed with a different party following a number of bids in September 2022.
But the administrators said the economic landscape shifted radically during this period in the wake of Kwasi Kwarteng’s disastrous mini-budget in late September.
“It became evident that the purchaser was seeking to change some of the deal fundamentals contrary to the HOTs,” states the report.
“Having flushed out the purchaser’s revised position, the joint administrators (in close consultation with their agents and the secured creditor) took the decision to abort the sale with this party.”
Assessing the impact of the mini-Budget and the resignation of Liz Truss just a few weeks later, the report concludes: “These factors most definitely had an adverse impact on the UK’s economic stability and had an adverse effect on wider macro-economic factors, which ultimately adversely impacted the sale as well as the wider market.”
The collapse of that deal ultimately led to a contract being signed with Killahoey Ltd just two days before Christmas, with the sale completed on February 1 this year.
Summarising the £46.5m sale, the administrators said: “Whilst this reflects a lower price than originally sought, and indeed a lower figure than that agreed in HOTs with the original purchaser, the economic challenges and uncertainty faced within the UK most definitely had an adverse impact on property values and market confidence.”
The administrators also said that while Sainsbury’s ceased trading at Rushmere in early 2022, its tenancy did not expire until March 2023, “meaning there was an imminent sizeable reduction in net operating income, which ultimately drives value”.