TWO shops which form part of the new Stonegate Walk development in York have been sold for a total of more than £5 million.

The Oakgate Group property company disclosed today that it has sold the 5,900 sq ft Next, in Stonegate, and the building which houses New Look women's fashion outlet, in Blake Street, to Starlight Investments Ltd.

New Look recently took on a 15-year lease at the 14,000 sq ft property.

Starlight, a subsidiary of London property specialists Dawnay Day, has also bought from Oakgate a Starbucks caf, on the junction of Albion Street and Commercial Street in Leeds, for about £3 million.

Now Wetherby-based Oakgate, which already owns much of the Swinegate retail development in York, is looking for new properties in the city in which to reinvest.

John Grantham, the chief executive of Oakgate, said: "We felt this was the best time to sell. In our view the properties, which were all bought about five years ago, had reached their optimum value. They have served us well.

"We are now looking to reinvest the £8 million raised by the sales in retail-led development schemes, similar to the Newgate shopping Centre in the heart of Bishop Auckland which we bought last year.

"We will be concentrating our efforts in York, the north of England and the Midlands, but will go further afield if the investment opportunity is right," he added.

The sale of New Look is the final piece in the jigsaw of the redevelopment of the former Stonegate Walk in the historic heart of York. Oakgate's £6 million development has transformed the ailing shopping arcade into a modern mix of city centre apartments and prime retail outlets. The development, designed by Regan Miller architects, won a major design award in 2001.

Oakgate teamed up with Bellway Homes (Yorkshire) Ltd to create Stonegate Court, 16 luxury city centre apartments above the new retail units. Some of these apartments have been created from the existing historic buildings on Blake Street, while those towards the rear are completely new. But Oakgate still retains one retail unit of 1,000 sq ft, in a courtyard setting, which is now available to let.

Meanwhile, Oakgate hopes to start development of 26 acres it owns at Monks Cross, Huntington, into the Vanguard science and business park, later this year.

Updated: 08:59 Tuesday, February 10, 2004