German property firm DIC Asset has bought a 75,000 m2 portfolio consisting of three fully-let retail properties in Germany in two separate transactions worth a total of €220 mln.
The properties are intended for a retail fund that DIC has yet to launch, CEO Aydin Karaduman said: 'We have already received encouraging feedback from potential investors.'
In one transaction, DIC Asset has bought a mixed-use retail centre located in Halle from Curzon Capital Partners III (CCP III), a core-plus fund advised by pan-European real estate investment manager Tristan Capital Partners, in a joint venture with Cornerstone Real Estate Advisers, for €59.3 mln.
The Halle-Neustadt shopping centre offers 30,700 m2 of retail, restaurant and leisure space, and is a dominant scheme in the local catchment area with nearly 5 million visitors per year. The centre has a 99% occupancy rate.
DIC was represented by BLP, while CCP III & Cornerstone were advised by Greenberg Traurig and JLL. HSH Nordbank financed the deal.
In the other transaction, the company has acquired two shopping centres in Hamburg, one in the district of Harburg and the other in the Bergedorf district. The schemes, which were modernised in 2011, have a combined floor area of around 44,500 m2 and are fully occupied on long-term leases. The anchor tenant and vendor of both properties is Marktkauf Holding, a unit of the Edeka Group.
According to Karaduman, the assets are 'superbly' suited for a retail investment fund with attractive dividend yields. 'What distinguishes the retail properties we acquired are their long-term leases and therefore their highly stable revenues, the outstanding micro-locations, and the high degree of centrality in their respective sub-markets.'
In total, the three properties boast a weighted average lease term around 11 years.
DIC Asset has already committed nearly €300 mln for new acquisitions this year, out of a target volume of €400-450 mln for 2016. Karaduman: 'We have kept expanding our fund business with much success. As a result, the income of DIC Asset will have two major sources in the future: one is the fund business, and the other being the rental income from our commercial portfolio.'
