Landsec to acquire U and I Group for £190m

Landsec has reached an agreement to acquire urban regeneration group U and I for a total of £190m, at a price of 149p per share.

The retail landlord said the move would combine U and I’s front-end development capabilities, placemaking skills and portfolio of core regeneration projects with Landsec’s “development expertise and strong balance sheet”.

Landsec added that U and I will help provide access to a “significant” pipeline of mixed-use development schemes, of which two sites in Mayfield, Manchester and Morden Wharf, Greenwich Peninsula, are already “well-progressed” in their development. 

In addition, U and I will reportedly provide access to a further “high quality, office-led” development in London at Landmark Court, Southwark, with planning consent.

Landsec noted there was a “strong alignment of cultures” between the two companies, who will now have a focus on “developing sustainable communities in the interests of broader stakeholders”.

Landsec previously set out a strategy in October 2020 to recycle investment in order to drive growth, with a focus on urban opportunities in London and other major regional cities. Following the latest acquisition, it said the move accelerates this strategy, bringing an “attractive pipeline” of mixed-use urban development opportunities to the group. 

The landlord said: “The Covid-19 pandemic has accelerated the blurring of lines between where people live, work and socialise. In response to this, mixed-use developments with a clear sense of place are becoming a more important part of the fabric of cities. 

“The directors of Landsec believe it is well positioned with its existing development and asset management capabilities and balance sheet strength to create these places and achieve attractive risk-adjusted returns.”

It added: “The Acquisition would add core regeneration assets to Landsec’s development pipeline, which Landsec believes it can help realise through the strength of its balance sheet, accelerating the delivery of Landsec’s “Urban opportunities” strategic pillar.”