Why it matters: The Buttermarket is poised to sell at a time of growth and opportunity, with new ownership set to take over one of the town's largest retail sites as it reports rising footfall and strong tenant commitments.
The details: The 220,000 sq ft shopping centre generates £2.17m annual income with an 11.8% net initial yield – the annual return on investment based on rental income – if fully let. Current tenants are committed for an average of 9.9 years to break, according to retail trade magazine Estates Gazette.
The centre is home to household names such as Omniplex cinema, Superbowl, PureGym, TK Maxx, New Look and Wagamama, alongside a 420-space car park.
What they're saying: Rebecca Bird, Centre Manager at The Buttermarket Centre, told Ipswich.co.uk in an interview: "This is a really positive thing for Ipswich and represents a massive new opportunity for new owners. There's so much untapped potential in the Buttermarket, and with the right vision and ambition, the new owners can take what's been started here to its full potential."
Footfall has increased 1.3% year-on-year, bucking broader high street trends, while major retailers have recently committed to new and extended leases, she said.
She explained: "TK Maxx, New Look, Grape Tree Foods – they've all re-signed. Superbowl has a new lease. We've got The Deesigner Hair Studio with a 15-year lease. There's a new tenant for Jacey's Café now the owner is retiring. Twist and Shout are re-signing. All these businesses are committing to Ipswich."
The timing: It comes just two days after Halo Service Solutions announced it will move its global headquarters to the Willis Building this spring, with plans to grow its workforce to over 1,000 employees.
Halo, a global technology company worth over £1bn, plans to hire over 400 graduates and young people per year by the end of 2030, with an average employee age of 24.2 years.
Bird highlighted the opportunity this creates: "With that many people working in a town location, a few minutes walk from the Buttermarket – that's a massive impact and a fantastic opportunity for businesses with their employees working in the office Monday to Friday for a sandwich or drink after work. The benefits will be far-reaching. It's such good news: further investment, more jobs."
She said the centre offers features attractive to potential tenants: "Any business who can see their customer base in Ipswich would be well suited here." She cited the "easy accessible parking, 24/7 operation and adjoining car park" as "desirable features."
The centre currently has 11 of its 30 units vacant, which Bird described as offering quality space for new businesses and potential partnerships with organisations. On the financial metrics, she noted that if all units are let, the 11.8% yield would be "very strong."
For context: DTZ Investors acquired the Buttermarket in 2017 for £54.7m, a year after its £35m refurbishment was completed. During its ownership, DTZ has invested in a new fire alarm system, roof works, rebranding and external improvements.
She said that the reason for the sale was that the current owner had decided to diversify its investment portfolio. Regarding the asking price, she explained: "The £10m figure is a representation of changes in climate. It reflects retail property values, changes in local areas, changes and continued increases in business rates – that's a massive thing that impacts big units."
She also noted the potential buyer landscape has evolved: "Those buying shopping centres have historically been one of the 'big boys'. Now you've got people with community schemes who really immerse themselves and grow assets. It could be a private fund or investor."
What's next: Cushman & Wakefield is handling the sale and reports positive interest from potential buyers, with completion hoped for within a year – in time for the new ownership to capitalise on the growing town centre workforce and possible City of Culture status in 2029.
The bottom line: The Buttermarket is changing hands at a time of growth, with rising footfall, committed tenants, and over 1,000 new workers arriving minutes away creating a strong platform for new ownership to build on.
