Sonae Sierra, the developer and service provider for retail-centred properties, has acquired a 50% stake in Balmain Asset Management Group’s Central European platform.
Balmain is an experienced operating partner and multi-disciplined service provider with a strong pedigree in European retail and leisure assets. Balmain has operated for over 15 years in Poland.
With this acquisition Sonae Sierra is able to enter the Polish market and create conditions for facilitating significant expansion opportunities into other CEE markets for the new JV entity, Sierra Balmain, the company said.
This joint venture will firstly be focusing on the continued expansion of the existing services of Balmain’s Polish portfolio, which already comprises a total of 15 shopping centres in 15 different cities in Poland. BSC Real Estate Advisors and BSC Property Management, subsidiaries of the Balmain Group, will be renamed in line with the Sierra Balmain brand but will continue to run and be governed separately to the asset management business.
The new JV will not be a direct investor but will continue to provide top-quality services to its client investors.
Sierra Balmain will combine both the international experience in retail real estate from Sonae Sierra, with the extensive local market knowledge of the Balmain team, which will retain management of the day to day business. With more than 100 experienced professionals, managing a portfolio worth over €1 billion, including 1,170 leases across more than 430,000 sqm of GLA, the Sierra Balmain joint venture will be providing a combination of asset management, property management and leasing services throughout its portfolio.
The joint venture will make use of both companies’ strong track records and growing service capabilities, coupled with a strong local market experience, in order to keep expanding its service business on all fronts, achieving great results and shaping tomorrow’s future in the Polish and other CEE markets.
“We are used to partnerships in new markets, and the opportunity to join Balmain and capitalise on its unique synergies with Sonae Sierra will allow us to grow our business in Poland and other adjacent markets in the future. The joint venture reinforces Sonae Sierra’s service business with a very interesting portfolio of clients in Poland and a very experienced local team, while laying the groundwork for further growth across other CEE countries.” states Pedro Caupers, Sonae Sierra's Chief Investment Officer and board director.
“We are both delighted and excited to be in this partnership with Sonae Sierra. From the outset of the discussions we sensed the operational synergies and like-minded approach to creating innovative environments for our clients’ real estate investments. The combined knowledge, resources and capability of Sierra Balmain will bring a new perspective to Poland and the region in the areas that we operate.” said James Turner, Balmain Group Managing Director.
The business will continue to be headquartered in Warsaw Towers, Sienna 39 but in new space on the 8th floor of the building. The Board of the JV will also include Sonae Sierra Executives Alberto Bravo and Alexandre Fernandes.
RPA Perspective This is the second recent deal from Sonae Sierra which, with the Slovakian real estate developer Peter Korbačka, has signed a joint venture agreement to acquire the GranCasa (Zaragoza), Valle Real (Camargo) and Max Center (Barakaldo) Shopping Centres, in Spain.
These centres were owned by the Sierra Fund (investment fund managed by Sonae Sierra) and by CBRE Retail Property Fund Iberica “CBRE RPFI, fund managed by CBRE Global Investors), each one holding a 50% stake, and were managed by Sonae Sierra.
Under the acquisition agreement, Peter Korbačka will have a shareholding of 87.5%, with Sonae Sierra owning the remaining 12.5% and providing all the management services. The transaction price is €485 million.
This joint venture agreement is in line with Sonae Sierra’s current strategy of reaching agreements with major international investors, looking for an operating partner able to provide top quality asset management, property management and development services, in order to redevelop the acquired properties and create value for the investors, the company said.
In respect to the agreement, Korbačka said: “Spain is one of the most solid markets in the real estate sector within Europe. We are delighted to acquire a portfolio of consolidated and dominant shopping centres in three of the largest and wealthiest cities in Northern Spain. In addition, having a partner like Sonae Sierra, gives us great confidence on the success of this opportunity.”
