Citycon is selling a Finnish retail portfolio for €76m ($83.3m) as it sees continued weak economic performance and subdued spending in Finland.
The Helsinki-listed firm said the 60,000 sqm portfolio of 13 regional grocery stores is being sold below fair value, with completion due next month.
Nils Styf, chief investment officer, said the sale is part of the firm’s strategy to “recycle capital and focus on mid-to-large sized urban, grocery-anchored shopping centres” in the Nordics and Baltics.
In its second quarter results released today, the Finnish retail specialist said “healthy economic growth” in Sweden was offsetting less favourable performance in Finland.
While Nordic retail sales are improving, growth for the first five months of this year has been at its worst in Finland, down 1.6%.
Prime shopping centre rents in Finland, Citycon said, remained stable compared to the previous quarter, but fell slightly year on year.
“The weak outlook for retail sales limits the rental growth potential,” the firm said.
Nevertheless, the second quarter of this year saw increased investment activity, with transaction volumes in the first half at their highest since the financial crisis.
Last year, a Canada Pension Plan Investment Board (CPPIB) subsidiary committed €200m to Citycon and took a 15% stake in the listed company.