UK Real Estate Investment Group Acquires Manchester Arena in $608m deal

The real estate investment group Secure Income has spent £436 million ($608 million) on two portfolios that include the 21,000-capacity Manchester Arena.

Manchester Arena
Manchester Arena
– Manchester Arena

The arena is part of an asset portfolio, which also includes 17 Travelodge hotels, 18 freehold high street pubs let or guaranteed by Stonegate Pub Company and The Brewery at Chiswell Street, London, “the largest catered events space in the City of London,” according to Secure Income.

Manchester Arena remains let to operator SMG Europe for the next 27 years.

“The attraction for us is that it’s a superbly located site let for the long term to a world class operator,” a Secure Income rep told Pollstar.

The investment group spent £224 million ($313 million) on this first portfolio and another £212 million ($296 million) on an additional 59 Travelodge hotels.

The group states that the investment in Manchester Arena produces £5.75 million ($8 million) net income per annum, “contracted to rise to over £6 million per annum on expiry of a lease incentive and following the next rental uplift on the Arena lease in June 2018.”

It continues: “the incremental net income from the Acquisitions will enhance both the Company’s dividend yield and potential for capital growth, and therefore total shareholder returns.”

Secure Income bought Manchester Area from real estate investment firm Mansford, which bought Manchester Arena for £82 million ($114 million) in 2013. The sale was first reported on Manchester Evening News.

Pollstar has reached out to SMG Europe for comment. Manchester Arena ranked No. 3 in Pollstar’s Worldwide Top 200 Arena Venues of 2017 for ticket sales, with 1,072,079 tickets sold.