Asda has struck a deal that will see a 10-acre store site redeveloped into a “new town centre” in north-west London.
The supermarket has partnered with property developer Barratt London in a project to transform the brownfield site, which is currently home to its Park Royal superstore, into a mixed-used scheme with retail units and 1,500 homes.
The plans, which are subject to approval, include a new 60,000 sq ft superstore with up to 400 parking spaces for customers.
The deal will see Barratt acquire the freehold to the site from Asda and as a condition build the new store for the supermarket to lease back with a 999-year long leasehold paying a peppercorn rent.
It represents one of the capital’s largest land transactions since 2019, according to Asda, and will result in “a new town centre for the local community”, including “high-quality public realm space”.
Many of the 1,500 homes will be on floors above the store, where there will also be a landscaped podium. About 500 of the homes are to be provided as affordable.
The development, which is in the Old Oak and Park Royal Development Corporation major regeneration area, will prioritise sustainability, according to the supermarket, with the homes to be car-free in the interests of encouraging public transport. The store car park will include electric vehicle spaces.
“Complementary businesses associated with a new town centre” will be able to open new retail units and restaurants.
Property portfolio
Asda head of mixed-use developments Ian Lawrence said the retailer was “also unlocking further opportunities to release value from our extensive property portfolio, which can be reinvested back into the business to fund other initiatives and support our long-term growth ambition to become the UK’s second-largest supermarket chain”.
“Asda’s venture into mixed-use property redevelopment marks a significant milestone for the business,” said Lawrence.
“By working with leading developers like Barratt London, we are able to maximise the full potential of our property portfolio for the first time.
“This allows us the opportunity to better serve local communities like Park Royal, with a new flagship store fit for the future, whilst creating windfall sites for housing delivery.”
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Barratt West London MD Craig Carson said: “We are proud to be partnering with Asda on their first mixed-use development. At Barratt London, we have a strong track record in both rejuvenating brownfield sites and delivering new homes in the Borough of Ealing, so it’s a partnership and site that makes perfect sense for us.
“This transaction is a sign that there is still land to be unlocked in the capital and reflects one of the market’s largest land transactions since 2019.
“The redevelopment of Park Royal will have a huge impact on the area, with the new town centre unlocking new commercial opportunities for local businesses and providing a new hub for the local community.
“The proposed delivery of 1,500 new homes will play a vital part in the Old Oak and Park Royal regeneration plans and will help to unlock much needed new and affordable homes in Ealing.”
Subject to planning
The planning application is to be submitted later this year, with Newsteer Real Estate acting as advisors to Asda throughout the process.
Newsteer director Ross Bettridge said: “Retailers such as Asda at Park Royal provide great opportunities to utilise brownfield sites and deliver much-needed housing for people living in the capital.
“At Newsteer, we are actively advising on similar opportunities with the potential to deliver c12,000 homes. The key to unlocking these sites is about protecting and enhancing the retail offer while balancing the viability.”
Asda also recently opened its 479th Express store, as part of its convenience expansion, taking it to the landmark of 1,000 UK sites in total for the first time in its 59-year history.
The retailer is aiming to have 500 Asda Express stores by the end of this year.
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