Singapore-listed IREIT Global has acquired 17 retail properties (13 freehold and 4 leasehold) in France for €76.8 mln.
The call option agreement was entered by subsidiary FIT 2 SAS with DKR Participations.
The properties have a combined gross lettable area of 61,756 m2, an overall occupancy rate of 100% and are expected to generate a net property income yield of 7.9%.
They have a weighted average lease expiry by gross rental income of 6.8 years and a weighted average lease to break by gross rental income of about 4.6 years as of 31 March 2023.
Louis d’Estienne d’Orves, CEO of the Manager, said: ‘We are delighted to be acquiring an attractive portfolio of Retail Parks (Out-of-Town) properties located in well-established regional retail areas. In this macroeconomic environment marked by high inflation, the proposed acquisition is in line with our strategy of strengthening our exposure to index linked assets in established European markets, supported by a strong blue-chip tenant. The Retail Parks (Out-of-Town) segment has outpaced the broader retail investment market. Their success is expected to continue due to their attractive yields for investors and lower rental costs for tenants, compared to other asset classes. We will continue to leverage on the expertise of our joint sponsors – Tikehau Capital and City Developments Limited to identify potential yield-accretive acquisition opportunities in Europe that will strengthen our portfolio in scale and diversification.’
The properties have been occupies since 2005 by B&M France, a subsidiary of European discount retailer B&M European Value Retail.
The deal will enable IREIT Global to diversify in resilient retail parks asset class, enhancing portfolio and income resiliency
Upon completion, IREIT’s enlarged portfolio in France will comprise of 44 retail properties with the proportion increasing from 24.9% (95,500 m2) to 35.3% (157,256 m2) of the REIT’s total gross leasable area of around 446,038 m2.
