The sales of two major European shopping centres, Islazul in Madrid and O’Parinor near Paris, are close to being finalised.
Eurofund and Henderson Park are in negotiations with Nuveen Real Estate to buy Islazul, the 90,700 m2 mall which Nuveen mandated Cushman & Wakefield to sell for over €300 mln last year, said two sources.
The transaction would be the second between specialist shopping centre investor/operator Eurofund and opportunistic investor Henderson Park. The pair bought Silverburn shopping centre in Glasgow last year.
Meanwhile, retail REITs Hammerson and Klépierre are close to a deal which will see Paris’s O’Parinor shopping centre finally change hands.
On the third attempt, and after several months of negotiations with Klépierre, Hammerson and co-owner National Pension Service of Korea (NPS) are believed to have accepted circa €200 mln for the 90,000 m2 shopping centre reflecting a net initial yield a little under 10%.
As part of the transaction, Klépierre is bringing in third-party equity capital.
Hammerson owns 25% of the French mall and NPS, 75%. They reappointed Cushman & Wakefield and Knight Frank to sell it, receiving a number of bids last July. Patrizia advises NPS.
Back in 2011 when NPS increased its stake in O’Parinor, the Korean investor paid Hammerson €106 mln for 24%.
The deal would mark Klépierre’s return to being a net investor in shopping centres.
The Paris-listed REIT, which counts US mall giant Simon Group among its shareholders, has been the best performing pan-European retail REIT, delivering annualized returns of 5%, according to analytics company Green Street.
Klépierre reported an 8% rise in footfall for the first nine months of 2023 and an 8.6% rise in net rental income which increased to €736.7 mln over the period.
The improvement in income streams from prime shopping centres is one of the main factors behind a string of investors deciding to try to sell interests in them now.
In addition to Islazul and O’Parinor, other dominant malls wholly or with partial interests for sale include: Blanchardstown in Dublin; Gropius Passagen in Berlin; and Meadowhall, Centre:MK and Liverpool One in the UK.
Hammerson is still a net seller as it continues to rebuild its balance sheet. Speculation resurfaced this week that it will soon sell its 40% stake in Value Retail.
In 2018 Klépierre, made and then dropped a bid to buy Hammerson after the UK REIT rebuffed its approaches.
See also: Malls in the shop window as retail rebounds which appears in the November-December edition of PropertyEU Magazine
