Peakside acquires Czech retail portfolio for €70m

European private equity firm Peakside Capital has acquired a portfolio of 72 retail properties in the Czech Republic for €70 mln.

Peakside purchased the assets on behalf of a separate account client from Atrium Europe Real Estate, a listed retail property company which is eeking to focus purely on shopping centres in Central and Eastern Europe.

The properties are anchored by food operators and benefit from an occupancy level in excess of 95%. Located throughout the Czech Republic, they provide a total lettable area of 177,000 m2 and primarily comprise smaller format retail properties with an average size of circa 2,500 m2. The leading anchor tenant is Netherlands-based retail chain Ahold.

Peakside is establishing a 50%-owned asset management platform with an initial focus to manage the portfolio, in a move which the specialist private equity firm said is consistent with its strategy of having a strong local presence in its primary markets, with 'boots on the ground'.

COMMENT
Commenting on the transaction, Otis Spencer, Managing Director of Peakside, said: 'This portfolio of diverse smaller format retail assets in the Czech Republic offers a number of interesting asset management opportunities and we are, therefore, delighted to have acquired this on behalf of a private client. The assets, located in one of our core markets, are ideally suited to our disciplined and targeted ‘buy-fix-sell’ investment strategy and we look forward to initiating our active management approach on the completion of the deal in the first quarter of 2015.'

Stefan Aumann, founding Partner of Peakside added: 'This transaction is the first for our newly created joint venture with a large separate account client to pursue opportunistic strategies in the CEE region.

'This portfolio is representative of the type of blueprint transaction we look to make on behalf of our clients and which we expect to be a precursor for further acquisition activity in 2015, as it combines value creation through active asset management with investment exposure to one of the most
attractive economies in Europe. Going forward, we plan to invest mainly in Poland, Czech Republic and Hungary, in opportunities where we will profit from the strong macroeconomic fundamentals, our on the ground presence and our proven track record of asset management achievements.'

For Atrium, the sale forms part of the rebalancing of its portfolio, Atrium CEO Josip Kardun said: 'This disposal marks another significant step forward in our ambition for Atrium to become the dominant shopping centre owner, operator and developer in our core markets within the CEE.

'Combined with our recently announced acquisition of the AFI Palác shopping centre in Pardubice, it means that we have significantly reweighted our income stream in the Czech Republic away from a significant number of smaller assets and, taking into account the recent acquisition of the Focus Mall in Bydgoszcz, Poland, provides our overall portfolio with a far greater focus on larger scale shopping centres and higher quality cash flow.'