A Canadian property giant will step up its spending spree in the UK this week with a £2.4bn deal for Center Parcs, the holiday park operator first launched to the UK public as the “holiday the weather can’t spoil” nearly 30 years ago.
Sources confirmed that the owner of the five UK parks for the past 10 years, US private equity firm Blackstone, is in detailed discussions with Canada’s Brookfield over the sale.
Brookfield has already splashed billions in the UK this year, teaming up with Qatar to launch a £2.6bn takeover of Canary Wharf landlord and developer Songbird Estates this year. It has also snapped up a swathe of office property in the Square Mile and will develop new £1bn skyscraper in the City.
The business first opened in the UK at Sherwood Forest in Nottinghamshire in 1987, and has since opened in Suffolk, Wiltshire, Bedfordshire and Cumbria. The parks boast an occupancy rate of 97 per cent, hosting nearly 2 million visitors a year and posting profits of nearly £150m last year. In April it secured an option on a site in Ireland, to become its sixth park.
Sources close to the bidding questioned the price tag put on the firm. “It’s an excellent business but expansion plans are limited and it’s at close to full occupancy.”
Center Parcs was set up in 1967 by the Dutch entrepreneur Piet Derksen, who opened sites across the continent and pushed into the UK in 1987. Two years later the company was snapped up by the brewer Scottish & Newcastle. S&N held it until 2001, when it decided to concentrate on its brewing business.
The European parks and the UK business were split. The UK parks were bought by the venture capitalists Deutsche Bank Capital Partners, who floated the operating business on the Alternative Investment Market in 2003 and sold the property to Hugh Osmond’s Sun Capital Partners.
But Center Parcs endured a rocky ride on public markets, warning over high energy prices and then being briefly dubbed “Center Pukes” after an outbreak of gastroenteritis at its Longleat Forest village in 2004.
Blackstone reunited the property and the operating business in 2006, paying £265m for the operating arm and £825m to Mr Osmond for the properties.Reuse content