An overview of the Oaktree portfolio up for sale

With the news that the Oaktree portfolio is up for sale, I decided to use LDC's online insight tool LDO to analyse these shopping centres. The portfolio is formed of three schemes with a total value of £120m; The Rushes in Loughborough, Vancouver Quarter in Kings Lynn and Kingsgate in Dunfermline.


Our analysis shows that the average vacancy rate across the portfolio has been below the GB shopping centre average since H2 2014. This demonstrates a continuous drop in vacancy rates across the schemes. This would suggest that these shopping centres have been successful in retaining their tenants, but also in attracting new occupiers to fill the previously vacant units.

Screen Shot 2017-03-30 at 19.32.42.pngFigure 1: Historical vacancy rates within the Oaktree Portfolio bench marked against the GB average for shopping centres (2011 to 2017). (Source: LDC)

Analysis of persistent vacancy rates shows that 5% of the total units have been vacant for more than 3 years, which could indicate potential issues for future owners, but also an opportunity to play with the tenant mix, unit format and size.

Screen Shot 2017-03-30 at 19.36.53.pngFigure 2: Persistent vacancy levels across the Oaktree Portfolio. (Source: LDC)

Drivetime Population Catchment

The below graph shows the population catchment across the centres within a 10, 20 and 30 minute drive time. Both King’s Lynn and Dunfermline have a comparatively small 10 minute drive time catchment. This is compounded by the fact that both towns have more attractive retail destinations, Peterborough and Edinburgh respectively, in the wider catchment, which could potentially impact the opportunity to attract shoppers and new national chains to the towns.

Screen Shot 2017-03-30 at 19.40.27.pngFigure 3: Drive time population figures across the three town centres within the Oaktree Portfolio. (Source: LDC)

Kingsgate.jpgImage 1: Kingsgate Shopping Centre, Dunfermline (Source: LDC)

The LDC Health Index developed in partnership with Morgan Stanley reveals that the Vancouver Centre scores negatively on the population density (see Figure 4 below) which means that there are too many shops for the local population catchment. It also shows that there is limited leisure offer (restaurants, cafes and pubs), which will impact the amount of time consumers might spend in the centre, footfall volumes and the night time economy. However, this does mean there is an opportunity to improve the leisure offer and tenant mix, through careful gap analysis. The presence of charity shops in the shopping centre is also considered as negative, with these occupiers on average paying lower rent per square foot.

Screen Shot 2017-03-30 at 19.44.52.pngFigure 4: LDC/Morgan Stanley Health Index score breakdown by asset. (Source: LDC)

The Kingsgate Centre scores positively on the affluence (earnings score) and presence of a department store, with these known as a factor for increasing footfall. However, like the Vancouver Quarter Shopping Centre, it suffers from a high level of competition, low population density and high persistent vacancy. 9.6% of the vacant units in the centre have been empty for longer than 3 years, this is twice as high as the national average for shopping centres. An opportunity for the landlord might be to seek planning consent for change of use.

The Rushes, which is the smallest centre in the portfolio, has the highest scores on vacancy rates, earnings and tenants mix, i.e. the retail and leisure offer.

Tenant Mix:

Evaluation of the tenants in the Vancouver Quarter and Kingsgate Centre shows that a number of the occupiers are at risk as they have been closing down units across their shopping centre estate in the last 12 months.

Vancouver Quarter Shopping Centre, King’s Lynn

Screen Shot 2017-03-30 at 20.08.34-1.png
Figure 5: 12 month percentage net change in units across GB shopping centres. (Source: LDC)

Kingsgate Shopping Centre, Dunfermline

Screen Shot 2017-03-30 at 21.50.09.png
Figure 6: 12 month percentage net change in units across GB shopping centres (Source: LDC)

LDC can support investors and landlords in due diligence, management and gap analysis of assets. If you wish to find more about how we can support your investments please get in touch with Senior Relationship Manager Nelia Vateva at Example reports for investors and landlords are available here -

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