Plaza Centers raises EUR 15m from Polish investors

Plaza Centers, a leading emerging markets property developer, has raised a total of PLN 60 mln (around EUR 15.2 mln) following the completion of the first tranche of a bond offering to Polish institutional investors. The bonds have a three-year maturity and bear an interest rate of six month Polish Wibor plus a margin of 4.5%.

The issue follows the approval in July 2010 of a bond issuance programme for up to PLN 300 mln (approximately EUR 75 mln), in several tranches. The tranches were approved for issuance between July 2010 and the end of 2016 as part of a long-term strategic financing plan.

Commenting on the bond issue in an interim Q3 management statement on Friday, Ran Shtarkman, President and Chief Executive Officer of Plaza Centers, said: 'Our approach to financing continues to be flexible, with the company utilising a number of sources for its long-term financing requirements. We were particularly pleased to have completed our first Polish bond offering in a region where we continue to see strong demand from investors.'

Shtarkman said that the outlook for the markets in which Plaza operates continues to remain uncertain, but that there was evidence of stabilising yields and increased occupier demand. 'In particular we have seen investment activity picking up in countries such as Poland, the Czech Republic and Hungary. In addition to this, we remain actively engaged in sourcing potential acquisitions, with a firm focus on our key growth market in the USA, where we hope to complete further accretive transactions in the near future.'

During Q3, the company also commenced construction of a new 22,000 m² shopping centre at Kragujevac, Serbia which is already 70% pre-let. A loan agreement for financing 70% (around EUR 33 mln) of the development costs has also been agreed. Completion of the mall is scheduled for Q1 2012.

Plaza has also commenced construction of its 10th retail scheme in Poland, the 39,000 m² Plaza which is expected to complete in Q4 2011. The company has agreed 70% bank financing (around EUR 52.5 mln) for the scheme.