Klepierre shops near Toulouse for EUR 251m

In a transaction worth a total EUR 250.7 mln, French property company Klepierre has purchased two hypermarkets and expansion projects for malls that it acquired in 2004 in the Greater Toulouse area. Klepierre's share of the investment is EUR 201.1 mln, with the insurer Cardif Assurance Vie responsible for the remainder. Cardif had already been Klepierre's partner in the original 2004 transaction involving two shopping malls adjoining Leclerc hypermarkets, located in Blagnac and Saint Orens outside of Toulouse.

Aside from acquiring the two hypermarket properties, Klepierre is also funding extensive expansion of both Blagnac and Saint Orens malls. Currently, the Blagnac shopping mall has a gross lettable area of 19,206 m². It comprises 68 retail outlets that adjoin a Leclerc hypermarket with 15,400 m² of sales floor area. All required permits have been obtained for a project to add another 11,300 m² to the existing configuration. Construction is underway and the extended mall is expected to generate net rents of EUR 6.1 mln at its scheduled opening in March 2009.

The Saint Orens mall currently has 10,797 m² of gross lettable area, including 56 retail outlets next to a Leclerc hypermarket with a sales floor area of 14,600 m². The extension will allow for an additional 11,100 m² in space, for which all permits have also been obtained and for which construction has commenced. That expanded mall is slated to open in September 2008, with net rents of EUR 4.6 mln initially expected.

On the hypermarket side, Klepierre will take over the two leases signed with Leclerc member Rémy Nauleau. The leases have conventional terms that include an index-linked rent adjustment clause. Klepierre has already paid EUR 138.4 mln of the purchase price, with the balance to be paid as the project advances. The total amount of full-year net rents expected from the transaction is EUR 16.8 mln, of which EUR 6.1 mln will be collected as of the acquisition date.