UK REIT Redefine International has agreed a €49 mln deal with Redefine Global to acquire control of a German retail portfolio in which it previously held a 50% stake.
The transaction gives Redefine International a 94% share in the German Leopard Portfolio, which comprises 66 retail properties generating a gross rental income of €13.9 mln. The assets are independently valued at €175.5 mln, reflecting a net initial yield of 7.4%.
The deal follows Redefine International's disposal of its 49% share in the VBG portfolio of German offices for €106 mln.
'In line with our strategy, this transaction represents a good opportunity to recycle capital into assets which generate a strong income yield, having sold the VBG portfolio of German offices at an 8.6% premium to book value,' commented Mike Watters, CEO of Redefine International. 'Our controlling interest in the portfolio will provide more flexibility over future asset management initiatives and reinvestment decisions.'
The Leopard Portfolio totals over 138,000 m2 of lettable area, including a mixture of stand-alone supermarkets, foodstore-anchored retail parks and cash and carry stores. 86.4% of the total annual rental income of the properties is located in Western Germany and Berlin with the remainder in Eastern Germany. The total occupancy is 99.2%.
The €49 mln deal includes taking on the Leopard Portfolio's existing debt facilities of €86.1 mln, €43.1 mln of which is contained in the company's existing share.
The seller is a wholly-owned subsidiary of Redefine Properties Limited, which is a substantial shareholder of Redefine International.
