Wereldhave has reached agreement to sell the Itis shopping centre in Helsinki to a fund advised by Morgan Stanley Real Estate Investing (MSREI).
With this transaction, Wereldhave has made a large step in realising its strategic agenda to focus on convenience centres, whilst improving its risk profile and strengthening the balance sheet.
The net price for the shopping centre including the deferred tax liability amounts to €450m. This reflects a gross price of €516 million which is 8.5% below the book value at 30 June 2018.
The transaction is scheduled for December 2018, subject to completion of the Finnkino development project and antitrust approval. After completion, Wereldhave’s portfolio will be strongly focused on one asset class, with 29 convenience shopping centres in Belgium (7), France (6) and the Netherlands (16). As Itis accounted for 15% of the portfolio, the single asset exposure will decrease to 7%, which improves the risk profile of the Company.
Once the disposal of Finland is completed, the LTV is expected to drop by 6%, thus significantly improving the capital structure of Wereldhave.
As a result of the completion of the transaction and the associated loss of rental income in December, Wereldhave expects the direct result for 2018 to be between €3.30 and €3.35 per share (previously €3.33 and €3.38). The dividend can and will be maintained at the current level of €2.52 in respect of 2018 and 2019.
Cushman & Wakefield’s EMEA Retail Capital Markets team advised Wereldhave on the disposal of one of the largest shopping centres in the Nordics, Itis in Helsinki, Finland, to Morgan Stanley Real Estate Fund.
The 100,000 sq m property is located in East Helsinki and comprises more than 150 shops and office space over five floors, attracting over 17 million visitors per year. Its anchor tenants include Stockmann department store, the flagship stores of Zara and H&M, and two supermarkets: S-Market and Lidl.
Michael Rodda, International Partner, Head of EMEA Retail Capital Markets at Cushman & Wakefield, said: “This sale is one of the largest single retail asset sales to take place in Europe this year and demonstrates the healthy investor appetite for fundamentally strong dominant shopping centres."
Cushman & Wakefield advised Wereldhave. Houthoff was Wereldhave’s legal advisor.
RPA Perspective Separately, 18 October was the official opening date for FOMO Store, a lifestyle pop-up concept in Molndal Galleria, Gothenburg’s newest shopping centre. A new shopping experience featuring a broad range of categories with a focus on brands that are not easily available in Sweden. Working on event-concepts that benefit the community and provide brands with the opportunity to engage with their customers.
FOMO is short for “fear of missing out”, a concept with ever-changing products throughout the calendar year; meaning that every time customers visit the store they will see, smell or taste something new. Like a micro-department store with a twist, focusing on an event format with exhibitions, workshops and experiential marketing.
“We encourage the entrepreneurial spirit in everything we do and see the brands as our partners. We are changing the business model and creating the future of retail along the way,” said Ilona Taillade, Founder, FOMO Store.
FÖMO lowers the risk for the retailer and provides the environment to test and launch new products or services. It is a place where retailers can engage with the customer to showcase and showroom their products. Brands are able to book space in the store through the We Are Pop Up platform.
