Scotch Corner Designer Village is pleased to share details of a unique opportunity to invest in the Scotch Corner Designer Village, a high‑quality retail and leisure destination at an iconic location, Scotch Corner, which is located at Junction 53 of the A1(M), near Richmond in North Yorkshire and is signposted from as far away as the M6 Motorway, 50 miles away.
Scotch Corner comprises a 50-acre site in North Yorkshire with full planning permission for c.182,500 sq. ft of branded outlet stores, cafes, and restaurants as well as landscaped gardens. The groundworks package has been fully implemented, and completion of the scheme is expected in Autumn 2027.
The Fundraise
The equity issue will raise £25.5m through an IPO of new shares in SCDV on Aquis and will be used to finance the main construction phase of development of the Village.
In addition, SCDV seeks to raise £33.2m of 14% secured loan note mezzanine finance. The remainder of the development cost is being funded through a net £67m of senior debt, which has been secured.
The existing freehold site will be rolled in to SCDV on admission by the founders in exchange for shares worth £16.5m at the issue price of 250p per share (c.40%). This represents a small discount to the £43.6m Savills valuation after allowing for c.£26m of accrued debt.
Key points
- Scotch Corner Designer Village is c.70% pre-let, with an additional 11% at Heads of Terms stage.
- Outlet Villages of this type represent the highest growth sector of the retail industry and the proposed Village is a unique offering in the North of England. The site has scope for the future growth of both retail and leisure opportunities.
- The catchment area contains 4.5m people within a 1-hour drive time and 29m vehicles pass Scotch Corner every year.
- Confirmed brands include M&S, Superdry, Tommy Hilfiger, Calvin Klein, Wagamama, and some 60 others.
- The GDV is c. £169m at practical completion, including the land acquisition for Phase 2. £42m of equity is intended to be created through the Aquis listing, comprising £16.5m for the property and £25.5m from the IPO. It is intended that the debt financing required to complete Phase 1 will come in the form of mezzanine debt, to be advanced on or around the date of the listing, and senior debt of £67m.
- The project is anticipated to return a 21.75% pa IRR and a 2.58x Equity Multiple (2.88x with surplus income), based on a 5.5-year period and refinancing once operational, which reflects the construction period followed by a four-year stabilisation period. The site is projected to be free cash flow positive (post financing costs) 12 months after IPO and the project IRR is determined based on an exit via disposal. An equity dividend is expected to be paid from 2027 onwards and increase annually in line with rental income.
Financial metrics
| Equity | 14% Secured Loan Note | |||
| Listing venue | Aquis (property segment Aram) | Listing venue | ISE Jersey | |
| Date | Late March | Date | Late March | |
| Raise | £26m | Raise | £33.3m | |
| Mkt Cap at IPO | £42m | Yield | 7% current & 7% PIK’d | |
| Value at Completion | £169m | |||
| IRR (5 yrs) | 21.75% | |||
