Over the course of three years, ATP and PensionDanmark acquired four department stores. Now the time is deemed right to sell them to the operator of the retail space, Magasin.
The deal just announced says something about physical retail in the age of ecommerce, with a Magasin executive stating: ‘It is our clear opinion that customers continue to prioritise physical trade, and with the ownership, this means that we can now develop and invest long-term.’
The two Danish pension investors acquired three Magasin department stores in January 2011 for an undisclosed sum from Magillum Properties. ATP agreed to carry out the asset management function.
The stores acquired were in the cities of Lyngby, Aarhus and Odense and measured 75,000 m2. At the time, Magasin was part of UK retailer Debenhams, which had owned Magasin since 2009.
Having acquired three department stores from Magasin in 2011, ATP and PensionDanmark followed up in January 2014 by adding a fourth - the store on Kongens Nytorv in Copenhagen.
ATP and PensionDanmark have since held a 50% share.
At the time, the pension fund investors reiterated they were pleased to add to their portfolio with another large investment with a long lease and secure returns. The seller in this instance was reportedly Solstra Investments.
These assets have fascinating histories. According to ATP’s web page, the wealth of detail on the façade of the Kongens Nytorv property in Copenhagen can be traced back to 1779. The property was designed as the city’s best Hotel ‘du Grand Nord’.
In the 19th century, its reputation altered from being a hotel for distinguished guests to something else. It earned the nickname, Bordel du Nord. The owner eventually went to prison for running it as a brothel.
Magasin was founded in Aarhus, and in 1870 expanded into the Kongens Nytorv property. It was inspired by the Paris store, Le Bon Marche.
This week's deal
In a joint statement accompanying the sale of all four properties, the two Danish pension funds cited different sector focuses as reasons to sell now.
As a postscript, it is worth noting that Debenhams went into administration in early 2021. It sold Magasins in May 2021 to German fashion retailer, Peek & Cloppenburg.
It also permanently closed all of its UK department stores. Yet the brand name and company was bought by online retailer, Boohoo. Today goods can be acquired online from the Debenhams website.
So while Magasin’s former owner, Debenhams, has essentially become an online-only retailer, Magasin wants to take back ownership control of its physical stores to develop and invest in them.
