TH Real Estate buys Edinburgh’s OMNi centre

TH Real Estate said it agreed to acquire the OMNi centre in the east end of Edinburgh city centre from Aviva Investors.

The OMNi centre is located next to the Edinburgh Playhouse at Greenside Place, opposite TH Real Estate’s £1 billion St James Centre development.

The OMNi centre is being acquired on behalf of TH Real Estate’s European Cities Fund which was launched in 2016 as a pan-European open-ended real estate investment vehicle.

Totalling 220,000 sq ft, the OMNi centre is anchored by a 12-screen multiplex VUE cinema.

The centre has a number of bars and restaurants, as well as a health and fitness club let to Nuffield Health and a luxury 77-room five-star hotel trading as The Glasshouse.

The purchase also includes a 990-space underground car park which is let to and operated by Q-Park Limited.

Andrew Rich, lead fund manager for the European Cities Fund, said: “We believe the OMNi Centre is an attractive investment for the fund due to the strong forecasted income return, high occupancy rate of over 96%, a long, well-diversified and secure rental income base, and the asset’s prime location in Edinburgh’s east end.

“The centre of gravity for retail and leisure activity is moving east in Edinburgh, as demonstrated by the new St Andrew Square development and Edinburgh St James (ESJ) redevelopment.

“The fund is in a unique position to benefit from the ESJ development as we can work with the teams delivering this project to ensure that we remain a complementary part of the offer at this end of the city.

“In our view, the OMNi centre should benefit from a general uplift in footfall as the area experiences significant positive change, enhancing the desirability of the location over the medium to long term.

“We have also identified a number of asset management opportunities to increase income return for our investors.

“As well as being one of the fastest growing and youngest cities in the UK, Edinburgh is also the UK’s second most popular tourist destination after London.

“We strongly believe in the investment fundamentals of Edinburgh and feel that the OMNi will prove to be a strong asset for the fund.”