Brighton Pier seeks GCC investors after UK market downturn

• UK sellers increasingly look to Gulf
• Price weakness raises attractiveness
• GCC investment in UK property seen up 11-20%

The owner of a 19th-century pier with fairground rides and amusement arcades on the south coast of England is seeking a potential buyer in the Gulf following a fall in UK property prices that has raised the attractiveness of British heritage assets.

The Brighton Pier Group bought the 126-year-old Brighton Palace Pier in 2016 for £18 million ($24.4 million) and is looking to sell for £15 million to £16 million amid a downturn in the market, its chief executive told AGBI.

CEO Anne Ackord said the group has received interest largely from UK buyers but is hunting for offers from the GCC.

“Why we thought of the Gulf at the beginning was that we just had an inquiry from someone [from the region]”, she said. While the discussions bore no fruit, Ackord said: “That made us think, OK, maybe we should spread our net a bit wider.” 

The group is in the early stages of courting Gulf investors and has not yet appointed a local broker, she added.
Estate agents say sellers of large British properties are increasingly looking to Gulf investors, in part due to poor market conditions in the UK.

Brighton Palace Pier is one of around 60 remaining “pleasure piers” in the UK, of which more than 100 were built during the Victorian era as amusement sites.

If sold to an overseas buyer, it will be the first pleasure pier owned by a non-British investor.

“This is probably the most important business for Brighton,” Ackord said. “So whoever owns the pier has an enormous amount of influence.”

The group put the pier on the market on January 2, a decision taken, Ackord said, as its major shareholders – HPB Pension Trust and businessman Luke Johnson – wanted to diversify their assets.

Last year the group also delisted from the London Stock Exchange’s junior market, citing poor consumer spending, high interest rates and rising wage costs.

“The UK economy is in a little bit of a state of flux at the moment,” Ackord said, “but hospitality and leisure have been hit quite hard.”

Prices weaker

Poor market conditions since the Covid-19 pandemic have pushed down real estate prices in the UK, making British assets more attractive to overseas investors.

BLME, a London bank that works specifically with Gulf investors, forecasts that investment from the region into British real estate will increase by 11 to 20 percent this year, reaching £3.4 billion. 

“Buying in the UK is a bit of a bargain,” said Francesco Nerici, a London-based branding strategist working with real estate developers. “I’m having lots of conversations about relations with Gulf buyers.”

More sellers are looking at ways to market themselves to the Gulf, Nerici said: “There is a perception here that big investments are coming from this area of the world.”

UK heritage assets, or buildings and structures that derive much of their value from their historical, cultural or environmental importance, are particularly prized by international investors, Nerici said: “There’s a lot of interest.”

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Whoever buys Brighton Palace Pier will also acquire the business attached to it, which employs 500 people in the summer and has made average annual profits of £1.6 million since 2021.

The pier requires “constant investment”, Ackord said, with structural upkeep alone demanding almost £1 million a year, not including investments in maintaining and developing rides and attractions.

“We very much want to find the right buyer,” Ackord said. “We want to find someone who will continue to manage it, develop it, but also treasure it.”