Several shopping centre purchases have been confirmed this month as Europe’s shopping centre sector prepares for the usual August slowdown.
Schemes in Spain, Portugal, the UK, Poland and the Czech Republic have all changed hands as a series of deals were pushed through.
Vukile has agreed to acquire a portfolio of four Spanish shopping centres for €460m. The deal is expected to increase the company's offshore exposure to above 40%. If approved, the transaction would increase the value of the portfolio in Castellana Properties, Vukile’s Spanish real estate investment trust subsidiary, from €390m to circa €870m.
The transaction is expected to be concluded by the end of this month and the vendor is Unibail-Rodamco-Westfield
The portfolio comprises the 43,423 sq m El Faro shopping centre in Badajoz, near Spain’s border with Portugal, the 24,789 sq m Bahia Sur shopping centre in Cadiz, the 17,906 sq m Los Arcos shopping centre in Seville, and the 35,220 sq m Vallsure shopping centre in Valladolid.
It will be funded by a combination of €257m in debt provided by European banks, €80m equity investment by a Morze-controlled vehicle, a €35m investment by Capreon Capital and a €123m equity investment by Vukile.
Laurence Rapp, the chief executive of Vukile, said: “This is an excellent quality portfolio, one of the best we have seen in the market so far. At a yield of 5.9%, it is attractive and accretive to Vukile representing a cash-on-cash yield of 8.1% in its first year. Vukile’s offshore exposure is now 47% of assets, of which 43% are in Spain and 4% in the UK."
Meanwhile, Focus Estate Fund has closed the transaction on the acquisition of the Galeria Gadawarna shopping centre in Bartoszyce (Poland), with a GLA 6,126 sq m.
Galeria was opened in April 2016 and represents a new high-quality building in the northern region of Poland. At the time of the transaction, the vacancy rate of the shopping centre was about 3%. The stores Biedronka, Jysk, KIK, Deichmann, ABRA are among its anchor tenants.
Transaction broker of the deal was KYHOS Real Estate, legal support was provided by Czabański Gałuszyński i Partnerzy, the international investment management company JLL became the property manager of the facility.
"We continue to maintain our strategy of diversifying the investment portfolio, acquiring properties not only in different geographical parts of Poland and the Czech Republic, but also supplementing the format of retail parks with small shopping centres with good location and additional traffic factors”, -said Maxim Shkolnick, Partner at Focus Estate Fund.
With this investment, Focus Estate Fund has increased its portfolio in the retail sector of the medium-sized format in Poland and the Czech Republic to five properties with a total lease area of more than 34 thousand square meters.
The Fund has acquired Park Handlowy Eden (Galeria Eden) located in Zgorzelec (Poland) and it is planned to invest more than €1.5m into its reconstruction.
Finally, Hammerson has exchanged contracts for the sale of two UK retail parks, Imperial Retail Park, Bristol and Fife Central Retail Park, Kirkcaldy, for a total consideration of €183.8m to Capreon. This transaction brings Hammerson's total proceeds from disposals in 2018 to €336.2m.
Imperial Retail Park, acquired in 2012 as part of the Junction portfolio, covers a total of 32,200 sq m and is the largest retail and leisure destination in south Bristol. The scheme is anchored by B&Q, The Range, HomeSense, M&S Foodhall, Next and Boots, and is currently 97% let.
Fife Central Retail Park, acquired in 2005, covers a total of 30,200 sq m, is 95% let and anchored by B&Q, Sainsbury's, M&S Simply Food and Next. Hammerson has actively managed the scheme during its ownership, delivering an extension and implementing key asset management initiatives, including repurposing space formerly occupied by Homebase to create a further four new retail units and two restaurants.
The total sale price represents a net initial yield of 7%, and a discount of approximately 10% to the December 2017 book value.
David Atkins, CEO of Hammerson, said: "We continue to see opportunities to dispose of selected assets in order to better deploy capital on behalf of our shareholders. With €336.2m (£300m) of sales achieved this year, we are already over half-way to reaching our planned disposal target for 2018. We look forward to providing a further update on disposals and capital deployment tomorrow when we report our half-year results."
Blackstone, represented by JLL, has completed the sale of Almada Forum from the Rio Tejo retail portfolio to Merlin Properties. The portfolio originally comprised three prime shopping centres and a retail park. Almada Forum is the last property in the portfolio to be sold. The purchase price was not disclosed. Combined the Rio Tejo portfolio represents the largest ever portfolio transaction in Portugal at over €900m.
“Almada Forum is an award-winning, dominant trophy asset benefitting from a unique location and strong performance. Comparable to a number of prominent shopping centres across Europe, Almada Forum appealed to a wide range of core international investors reinforcing confidence in the Portuguese market,” said Fernando Ferreira, JLL Portugal Head of Capital Markets.
