Finnish pension insurance company Elo has doubled its stake in a Helsinki shopping centre to 70%, following a deal with Unibail-Rodamco-Westfield (URW) worth almost a quarter of a billion euros.
The €22.6bn Finnish investor said it has become a majority shareholder in the Jumbo shopping mall, by acquiring URW’s entire 34% stake for €248.6m.
Timo Stenius, director in charge of unlisted investments at Elo, said: “There is a lot going on in the metropolitan shopping centre market and competition has intensified with new openings.
“Active management and long-term development of the best shopping centres provide a good opportunity to respond to the changing demands of consumers and the changes in retail trade,” he added.
Elo said Jumbo is Finland’s largest shopping centre, with sales totalling over €400m per year, and that it has maintained this top spot for several years in a row.
URW’s sold its stake as part of a €3bn asset disposal plan the company announced in December of 2017, which it announced on 13 Feb had been increased to a target of €6bn.
Lars-Ake Tollemark, regional chief executive of the Nordics for URW said: “This disposal will enable us to concentrate further on strategic assets in the Nordics with significant re-development and mixed-use opportunities.”
The shopping centre, which comprises of 85,000sqm of leasable space and draws in around 12m visitors per year, is situated south of the Aviapolis area.
Elo also currently holds an approximate 25% stake in Finnish shopping centre Sello and has shares in a number of other malls.
The pension provider said its investments of this type focus on shopping centres that “have the capacity to meet the challenges of the changing retail market”.
RPA Perspective URW completed the disposal of its 34% stake in the Jumbo shopping centre in Helsinki, Finland, to current co-owner Elo. The net disposal price of €248.6m represents a premium to the December 31, 2018, book value and implies a net initial yield of almost 5%. Jumbo is one of the leading shopping centres in the Helsinki region with more than 85,000 sq m GLA and over 12 million visitors per year. Following this transaction, URW's Nordics portfolio consists of five shopping centres of which three are flagships.
Lars-Ake Tollemark, Regional Managing Director Nordics for URW, declared: "The success of this transaction shows the high quality of our assets, their attractiveness and their liquidity. This disposal will enable us to concentrate further on strategic assets in the Nordics with significant re-development and mixed-use opportunities."
Meanwhile, BlackRock Real Assets’ Eurozone core property fund has added a 12,200 sq m mixed-use retail and office asset in Helsinki to its portfolio.
The BlackRock Eurozone Core Property fund bought the asset in the central business district of Helsinki last month.
The latest deal is the fund’s third investment, following the acquisition of an office asset in Hamburg and a portfolio of two logistics assets near Munich and Regensburg. The fund offers its investors diversified exposure to income-generating core real estate, in an open-ended vehicle.
BlackRock said the has an active investment pipeline and will continue to diversify its exposure across the Eurozone’s most liquid markets.
Ian Williamson, the portfolio manager of the Eurozone Core Property Fund, said: “This transaction is representative of one of our key strategies: seeking very well-located properties presenting opportunities for generating income growth, and also furthers our portfolio diversification with office and retail exposure in a fantastic location, backed by a growing Nordic economy.”
