DIC Asset invests EUR 37 mln in retail parks

Frankfurt-based real estate company DIC Asset has reached agreement with Rheinische Grundbesitz & Beteiligungs on the takeover of five retail parks under construction in the Rhine-Neckar region of Germany. DIC Asset said more acquisitions are planned.

The parks have a total rental space of 25,000 m² and are fully let. The total volume of the off-market transaction comes to around EUR 37 mln, reflecting an initial yield, including the closing costs, of 7.25%. The parks are due for completion in 2007. Two years ago DIC Asset acquired the Rhine-Main-Neckar portfolio of eight properties from Rheinische Grundbesitz, the investment arm of Dietz, for EUR 58 mln.

DIC Asset said the latest acquisition is part of its strategy to expand the high-yield retail portion of its real estate portfolio. In the medium term, the company plans to increase the ratio from the current 17% to around 30%.

The retail parks are within the Darmstadt-Bergstraße area with sites in, for example, Bensheim and Pfungstadt. They are leased to companies such as EDEKA, REWE and AWG. The long-term lease period is, on average, in excess of 13 years, DIC Asset said.

' We are currently involved in somewhat exclusive negotiations regarding a total transaction volume of up to EUR 350 million, in which DIC Asset AG will participate as co-investor,' said Ulrich Höller, chairman of DIC Asset.

Established in 2002, DIC Asset AG, describes itself as a real estate company with a dedicated investment focus on commercial real estate in Germany, pursuing a return-oriented investment policy. Its portfolio currently includes more than 775,000 m² of floor space, spread over 217 properties and the real estate portfolio currently being managed totals around EUR 1.9 bn.