European retail REIT Eurocommercial has acquired Valbo shopping centre in Gävle, Sweden from CBRE Global Investors. The price of SEK 1.14 bn (€116 mln) represents a yield of around 5.3%.
Toby Smith, portfolio manager ESCF, CBRE Global Investors, said: 'We are very pleased with this transaction and to have worked with ECP on this deal. We have achieved strong returns for our investors as we managed to reposition the centre and refreshed the tenant mix through the reduction of the hypermarket space, a theme which we believe offers considerable value.'
CBRE Global Investors acquired the asset in July 2014 in a joint-venture with the Teachers Retirement System of Texas (TRS). This latest transaction follows the wider ESCF disposal program which has included Galeries Saint Lambert (Belgium), Tyresö Centrum (Sweden) and StadtCenter Düren (Germany).
The acquisition was partially funded by Eurocommercial's recent Swedish sales of Mellby and 421 in Göteborg.
Valbo is the only regional shopping centre in the county of Gästrikland, central Sweden, which serves a catchment of around 250,000 people.
The shopping centre has 37,200 m2 of lettable area and is let to 70 tenants including a 6,775 m² Coop hypermarket. Other major retailers comprise H&M, Systembolaget, Clas Ohlson, KappAhl, Lindex, Stadium and the main Varner Group brands. The centre is attached, and partly-let, to an Ikea store.
Eurocommercial’s CEO Jeremy Lewis said: 'Valbo is an excellent shopping centre with significant potential for further improvement, and is an important addition to our portfolio of high-quality retail assets. Its location, tenant mix and lack of competition meet our core criteria for acquisitions in Sweden - the dominant external centre in a leading provincial city, anchored by a hypermarket.'
The purchase follows Eurocommercial's recent acquisition of the 40,600 m² C4 Shopping development outside Kristianstad (now over 80% pre-let) and the re-launch of the fully-let Hallarna outside Halmstad, which will have around 90 tenants once the 44,000 m² project is completed later this year.
Eurocommercial has recently focussed on disposing of properties with limited potential for further development to recycle the proceeds into larger, high-quality shopping centres. Since September 2017, the company has sold €180 mln of real estate as part of this asset rotation programme and agreed to sell another €187 mln worth of assets in Italy.
Further sales are being prepared, according to the company.
