New Europe Property Investment (NEPI) has acquired Promenada mall, the related transaction concluded on October 31, 2014, coming to 148 million euro, amount settled from NEPI’s existing cash resources, states a notification sent to the Bucharest Stock Exchange.
The transaction between NEPI and Raiffeisen Evolution, the project developer which was advised by Jones Lang LaSalle, is the largest ever recorded in Bucharest involving a single property.
“The sale of Promenada Mall just weeks after completing successfully another transaction in which JLL was involved – the acquisition of Bucharest’s largest industrial park by P3 –clearly shows that Romania is again “in the spotlight”. Despite the large volume of the deal, many international investors expressed strong interest in acquiring this high quality project. This is the largest transaction of a single asset ever concluded in Bucharest and second largest in Romania”, commented Gijs Klomp, CEO and Head of the Investment Department of JLL Romania. The team involved in this transaction additionally comprises Agata Sekula, Regional Director, Andrei Vacaru, Head of Research & Consultancy and Diana Iorgulescu, Analyst.
The purchase price is equivalent to the valuation amount, as estimated by the NEPI, which foresees an annual income of about 10 million euro resulting from renting commercial spaces in Promenada, where the monthly weighted average rental is 22 euro per sqm.
The South African investment fund’s interest in the retail project has been previously confirmed by its CEO, Martin Slabbert: “We are, indeed, in the process of due diligence for the acquisition of Promenada. We are one of the investors interested in this project, but NEPI has sufficient financial resources for buying Promenada. We hope to complete the takeover as soon as possible, but it is not only up to us, but also to the seller”, said Slabbert about a month ago, as per Mediafax..
According to the same sources, the developer, Raiffeisen Evolution has been submitted several offers, the condition for disposing Promenada of, being an offer of at least 150 million euro, which includes the transfer or refunding of the 95 million euro loan granted by Raiffeisen Bank for the retail project.
Requiring initial investment of 130 million euro, the shopping center located in Northern Bucharest covers a gross leasable area of 35,000 sqm, hosting more than 120 stores and 1,300 parking spaces. Promenada mall is part of Floreasca City, project also incorporating two office buildings.
NEPI is one of the most dynamic real estate developers in the Romanian market where has a portfolio including a wide range of properties, both in the retail and the office real estate sectors. Mega Mall (Bucharest), Shopping City Targu Jiu and Vulcan Value Centre are the latest development projects in the retail real estate sector from NEPI’s portfolio, which also includes other three new office property projects – City Business Center in Timisoara where the Group has a forward purchase agreement for two additional buildings, The Office Cluj-Napoca where there has been commenced the first of three phases of a joint venture office development and Piata Victoriei Office.
In Romania, the investment fund runs development or extension projects of nearly 430 million euro with a total GLA on completion of 257,000 sqm, according to the H1 2014 results displayed on its website.