THE CROWN Estate this week completed the purchase of Oxford’s Westgate Centre for £56m.

And it immediately sprung a surprise by announcing that it has sold a 50 per cent stake in its newly acquired shopping centre to the Land Securities Group, which has been responsible for major shopping developments across the UK.

The news will boost hopes for a high-quality shopping centre going ahead in Oxford, with a John Lewis department store being the flagship store in a redeveloped Westgate.

The Crown Estate, the UK’s largest commercial landowner, said the new partnership would seek “to enhance the shopping experience at Westgate and the existing retail mix at the Westgate”.

The creation of the 50:50 joint venture partnership with Land Securities Group at the Westgate follows on from a scheme that the two property giants are undertaking together in the West Country.

They recently formed a partnership at the Princesshay Shopping Centre in Exeter.

The Crown Estate is now under the chairmanship of Sir Stuart Hampson, who used to be chairman of the John Lewis Partnership.

The estate is said to be committed to diversifying its property holdings away from London and the purchase of the Westgate is viewed as a key part of that strategy.

Land Securities’s shopping centre and retail park holdings extend to cities such as Bristol, Cardiff, Glasgow, Leeds, Liverpool and Portsmouth.

James Cooksey, head of diversification and central London portfolios at The Crown Estate, said: “We are excited about this major purchase and look forward to taking a long-term approach to asset management and stewardship of this important scheme.

“Westgate has the potential to significantly enhance Oxford city centre’s retail landscape and our commercial expertise and investment track record will help realise that potential.

“We are keen to work closely in the future with key stakeholders including the city and county councils, along with prospective retailers, in particular the John Lewis Partnership.”

The company said it was too early to suggest when new plans would be submitted or provide a timetable for the Westgate development.

Richard Akers, managing director of the Land Securities retail portfolio, said: “Oxford is potentially one of the most exciting city- centre retail opportunities in the UK. The city’s character, combined with strong tenant demand and an attractive catchment, provide excellent scope for both asset management and development.

“In partnering with The Crown Estate we are building on the relationship established at Exeter and based on a shared approach to long-term asset management.”

John Lewis property director Jeremy Collins said: “This is positive news for the Oxford city centre and we look forward to working closely with partnership and the council to bring our John Lewis department store to fruition.”

The £330m development plan proposed by previous Westgate owner Capital Shopping Centres is now expected to be substantially scaled down.

Land Securities secured its stake in the Westgate from The Crown Estate for just over £28m. The property will be jointly held in a new limited partnership.

A statement released by Land Securities said the 320,000 sq ft centre comes with two ‘cleared’ sites at the rear that had been acquired previously to facilitate development of a 750,000 sq ft shopping centre anchored by John Lewis Partnership. It also benefited from an adjoining local authority-owned 1,200-space car park.

It added: “Oxford is ranked as one of the most affluent cities in the UK, with per capita spend significantly above the average. Its role as a major regional city is enhanced by a large student population and its popularity as a national and international tourist destination.”

The Crown Estate has a property portfolio valued at £6bn.

Historically, the possession of the crown, the estate is no longer the private property of the reigning monarch.

The surplus revenue from the estate is paid each year to the Treasury.