London-based finance and property group Dawnay, Day Treveria (DTR) has announced that it is to purchase two Hertie department stores in Germany for a combined sum of EUR 22 mln. DTR will acquire the two properties from Dawnay, Day Group which owns the Hertie chain. The company believes that there is a strategic advantage in acquiring these properties as they are adjacent to existing sites within the company's portfolio. The blended net initial yield of the two new acquisitions is 6.97%.

London-based finance and property group Dawnay, Day Treveria (DTR) has announced that it is to purchase two Hertie department stores in Germany for a combined sum of EUR 22 mln. DTR will acquire the two properties from Dawnay, Day Group which owns the Hertie chain. The company believes that there is a strategic advantage in acquiring these properties as they are adjacent to existing sites within the company's portfolio. The blended net initial yield of the two new acquisitions is 6.97%.

The first property adjoins the shopping centre Nordsee Passage in Wilhelmshaven, which was acquired by DTR from Degi in November 2006. It comprises 28,341 m2 of retail space and 600 parking spaces. Tenants include H&M, C&A, Kult and Promarkt. The total lettable area of the department store is 10,671 m2, leased to Hertie until 2020 at a rent of EUR 587,891 per annum.

The second property is located within the Marler Stern shopping centre in Marl, North Rhine-Westphalia. DTR acquired 19% of this shopping mall from Union Investment Real Estate in June 2007. The current acquisition will bring the company's stake to 44%.

The shopping centre comprises 58,000 m2 of retail space and a car park. Tenants include Wehmeyer, H&M, Deichmann and C&A. The total lettable area of the department store is 14,937m2, which is leased to Hertie until 2020 at a rent of EUR 972,085 per annum.

According to the announcement, the acquisitions are related party transactions as Peter Klimt, a director of DTR, is one of the principals of Dawnay, Day Group. Having consulted with their adviser, Citigroup Global Markets UK Equity Limited, the directors of DTR, excluding Mr Klimt, consider the terms of the transaction fair and reasonable insofar as DTR's shareholders are concerned.