Member Article

Retail giants invest in commercial property business

Renowned retail experts Lord Rose and Terry Green have invested an undisclosed sum in Select Property Group (Select), a global developer, retailer and operator of investment property brands which is headquartered in the UK.

The group is engaged in a Joint Venture partnership to deliver the residential aspect of a £750 million mixed-use scheme on the former BBC site in Manchester which will launch a brand new private rental sector brand yet to be announced.

The flagship site of its CitySuites brand aimed at the business traveller is also in development at another Manchester city centre site.

Lord Rose is best known for his time as CEO and Chairman of Marks and Spencer and, until recently, he sat on the board of Land Securities, the UK’s largest commercial property organisation.

Terry Green made his name in retail during his time at Debenhams in the nineties and met Lord Rose at the Burton Group before undertaking further board-level positions at BHS and Tesco.

Other big names from the sector already involved in the business include Angus Monro, former CEO of Matalan and Instore, and Trevor Moore, former CEO of Jessops and HMV, who both hold board-level positions at Select.

Pivotal to the decision was the group’s retail-led approach which is unusual within the property sector but gives Select control over every aspect of the property investment lifecycle.

Select create end-user focused brands, develop the schemes, sell them to investors, and finally find the tenants prior to operating the buildings.

The group cites its Vita Student brand as an example of how this approach works. Despite prices being an average of 15% above the general market level, the accommodation provider achieved 100% occupancy in the 2014/15 academic year.

Select Property Group has six fully operational student schemes in the UK under its Vita Student brand with three more in development.

Select has completed 969 Vita Student units, with 366 due for completion in September for the 2015/2016 academic year.

Across the Group’s portfolio of brands, a further 1647 units are under construction with 871 due to start construction in 2016.

Lord Rose said that the property market could learn a lot from the retail industry: “Select’s unique approach to the property market makes the company a particularly interesting investment.

“While other providers focus on development, with the sales and operational activity often outsourced to third parties, Select’s control over the whole process allows it to manage every aspect of the investment lifecycle.

“The years I spent at the heart of retail means that I deeply appreciate the value of great customer service, and this is closely reflected in Select’s philosophy.

This retail-led approach has enabled them to deliver an exceptional product in the student accommodation sector, a formula which I believe they will go on to replicate across multiple markets.“

Terry Green added: “The company and its board have a clear vision to develop and maintain brands that understand the end user and cultivate customer loyalty, all of which equates to a high-performing investment.”

Mark Stott, CEO of Select, said: “We’re delighted such prestigious retail leaders have invested in the business. This adds further validation to our approach to investment property and marks an exciting time for Select Property Group.”

Select Property Group has six fully operational student schemes in the UK under its Vita Student brand with three more in development.

This was posted in Bdaily's Members' News section by Simon Malia .