Singaporean sovereign wealth fund GIC is paying €250 mln to acquire a 20% stake in major Turkish developer-investor group Renaissance Real Estate Investment.

Singaporean sovereign wealth fund GIC is paying €250 mln to acquire a 20% stake in major Turkish developer-investor group Renaissance Real Estate Investment.

Renaissance holds 25 retail and office properties in its portfolio, of which 12 are income-generating, eight are under development and five are land plots covering 540,000 m2.

Known as Ronesans Gayrimenkul Yatýrým (RGY) in Turkish, Renaissance is the real estate arm of Ronesans Holding (Renaissance), a group of companies focused on construction, real estate investment, energy generation, health and education activities in Turkey, Russia and the CIS and the MENA region.

RGY and GIC announced on Thursday that they were forming a strategic partnership with GIC subscribing to a €250 mln rights issue to fund acquisitions and development of new projects in Turkey.

Chris Morrish, regional head of GIC Real Estate for Europe, said: 'We are pleased to be making our first corporate real estate investment in Turkey, by taking a minority ownership position in RGY, one of the most reputable property developers and investors in Turkey. As a long-term investor, we are confident that Turkey will continue to grow and present good investment opportunities.'

RGY and GIC are building on an existing working relationship. Since 2012, RGY and GIC have formed 50:50 joint ventures to own the Optimum Istanbul, Optimum Ankara and Optimum Izmir shopping centres.

The new strategic alliance comes amid concerns about the continuing vitality of the robust Turkish real estate sector, and development in particular. Various media sources have cited rising interest rates and a decline in the value of the Turkish lira currency, coupled with political unrest as challenges for project developers which have been building offices, shopping centres and homes at record rates in recent years.