News from 12/13/2007
Arcandor: Department store deal finalized
Arcandor reported the sale of its 49% share in the former Karstadt department stores. It announced that a letter of intent has been agreed upon with a consortium made up of the Deutsche Bank subsidiary RREEF as well as the Italian firms Pirelli Real Estate and Borletti. Arcandor stated that, as previously indicated, it will receive €800mn from the transaction. CEO Thomas Middelhoff also announced the founding of a strategic department store alliance with the purchasing consortium: Arcandor is to take on an up to 25% share in the first-class department store chains Printemps and Rinascente; the consortium, according to Arcandor, will have an up to 25% share in Karstadt’s Premium department stores. However, in a statement sent to the Italian stock exchange, Pirelli RE denied that there is any agreement yet to exchange stakes, adding that it signed a non-binding letter of intent "only to evaluate if there are the premises in the future for the creation of a European group of department stores in the premium sector."
Degi: Future Italian headquarters of Procter & Gamble acquired
Degi has made new commitments in Rome: in the E.U.R. office market area of the Italian capital, the company has acquired for its open property fund Degi International a project to be completed by the end of 2008. The seller of the second office complex in the “Europarco” development is Parsitalia S.r.l. The maximum total investment volume is reported at €122mn. There is said to be a shortage of high-quality office space in Rome, with a vacancy rate of a mere 2%; Degi’s management is therefore confident that the property will be rented without delay, adding that approximately two thirds of the 17,585 sqm of office space in the Viale Oceano Pacifico has already been provisionally rented to the Italian headquarters of Procter & Gamble Holding S.r.l.
Alstria Office REIT-AG: Portfolio with 74,500 sqm of leasable area acquired
Alstria Office REIT-AG reports the acquisition of a portfolio containing 13 objects with a total leasable area of approximately 74,500 sqm used mainly as office buildings. The total cost of the objects located throughout Germany is said to be around €113.3mn, annual yield from rents is ca. €7.7mn. According to the announcement, the anonymous seller will continue to use 66% of the space, renting it for periods of 5 and 10 years. 20.5% of the area is rented to third parties. Alstria’s management sees the 13.5% vacancy rate as additional potential for raising returns with new rentals. The transaction—which is still pending the approval of the cartel authorities—is to be completed in the course of the coming year.
Europolis: Building East European portfolios with €3bn
Europolis, a subsidiary of Österreichische Volksbanken AG (Austrian People’s Bank) (ÖVAG), intends to put together three property portfolios focusing on Eastern Europe. By 2012, each portfolio is to include buildings with a value of €1bn, Europolis CEO Bernhard Mayer told the Austrian newspaper Wirtschaftsblatt. The total value of Europolis’ property inventory will thus grow from €2bn at present to as much as €5bn. The projects will be funded mainly by ÖVAG, Mayer said to the newspaper. The European Bank for Reconstruction and Development (EBRD) is to participate in one of the three portfolios; external investors are being sought for the third fund. Investments in new shopping centers in St. Petersburg and Moscow and in a Prague office building are already certain.
Ebertz & Partner: Four-star hotel in Krefeld sold to Danish investor
The Novotel in Krefeld has a new owner: the object belonging to the closed Sachwertfonds Nummer 38 (Asset Value Fund Number 38) initiated by Ebertz & Partner 17 years ago was sold to a Danish investor. The occupant of the four-star convention and conference hotel with 155 rooms is NewGen-Hotelgesellschaft (Hotel Company) belonging to the internationally active Accor concern from France. The investment company reports that the average yield for the investor will run to some 12% annually before taxes during the entire period.
Berlin: Estama rents 400 sqm in Beisheim Center
The Berlin asset management company Estama GmbH moved into its office measuring approximately 400 sqm on the seventh floor of the Beisheim Center on Potsdamer Platz at the end of November. The firm founded in 1995 states that it focuses on retail and logistics and currently administers 160 objects with a volume of €1.3bn. Edinburgh House Estates located in London is its principle customer.
GLL Real Estate Partners: Shopping center acquired in Poitiers
GLL Real Estate Partners, Munich, has acquired the shopping center "Les Cordeliers" for its GLL Retail Fund. Located in Poitiers, the center has 16,000 sqm of sales area and some 40 stores. The seller is a joint venture made up of Klépierre and the Belgian ING Real Estate Property Fund.