Hammerson has today announced that it has exchanged contracts to buy the Victoria Quarter retail developent  in Leeds for £136 million.

The Victoria Quarter is anchored by Harvey Nichols and contains over 70 stores and 2 cafes, with County Arcade and Queen Victoria Street having a further 30 and 26 stores respectively, to produce a passing rent of £7.2 million.

The initial yield is 5.25%, which suggests that Kennedy Wilson, the US investors who recently bought a tranche of distressed Irish debt have done some tough negotiating. They were advised by CBRE. They were acting on behalf of Bank of Ireland Private Banking who acquired the freehold from developers Highstone Estates in 2006

Hammerson, who were advised by DTZ and Strutt & Parker, plan to submit a detailed planning application for it's adjoining Eastgate Quarters in the coming spring. They hope to complete the first phase in 2016.

The Eastgate Quarters will be anchored by a new 260,000 sq ft John Lewis and will contain 6 restaurants and a 600 space car park, and will directly access Victoria Quarters.