Top 5 deals, Week 45 (3-7 November 2008)

The largest deal recorded by PropertyEU between 3 and 7 November for which the financial details were given was Topland's acquisition of a portfolio of 12 hypermarkets in the Basque region of Spain from retail group Eroski for EUR 361 mln.

1. Topland concludes largest Spanish hypermarket sale-and-leaseback for EUR 361 mln

2. Union investment acquires Frankfurt development for EUR 93m

3. Nieuwe Steen acquires Swiss shopping centre for EUR 47m

4. IVG fund acquires office property in Bristol for EUR 27m

5. SEB acquires Segro park in Hungary for EUR 20m

Scroll down for the news on the deals

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1) Topland concludes largest Spanish hypermarket sale-and-leaseback

Privately owned UK property investor Topland has acquired a portfolio of 12 hypermarkets in the Basque region of Spain from retail group Eroski for EUR 361 mln.

The deal, which comes on the second day of Barcelona Meeting Point, is the largest hypermarket sale & leaseback transaction in Spain ever. It also marks the first phase of a transaction which will amount to more than EUR 1 bn. The vendor described the deal , involving six major Spanish banks, as a 'remarkable achievement in this difficult financial climate'.

Eroski has created a joint venture company with Topland to manage part of its hypermarket portfolio in Spain. Cushman & Wakefield was the advisor on the deal.

Roger Cooke, managing director of Cushman & Wakefield Spain, commented: 'This transaction is a very positive signal to the investment market and that Cushman & Wakefield has other transactions in due diligence which we hope to close before the end of 2008.'

Law firms Hammonds and DJV Abogados acted for Eroski and Freshfields for Topland.

Under the agreement with Topland, a single joint venture vehicle will own most of Eroski's hypermarkets in Spain. The 12 individual hypermarkets spun off in the first phase of the transaction have surface areas within a range of 5,000 m² and 11,000 m².

Eroski embarked on the sale of its hypermarket portfolio in the summer of 2001 when it sold nine buildings to ING Real Estate. This was followed by the sale of another seven properties to Eurohypo Real Estate Investment Banking at the end of 2002.

Topland has already carved out a niche for itself as a specialist in retail sale-and-leaseback transactions in the UK, but this is its first deal in Spain. Topland, which has property assets in excess of EUR 6 bn, acquired 33 supermarkets and two distribution centres from Tesco in 2004, and a Marks & Spencer portfolio of 78 stores in 2001. Topland has since sold its interest in the joint venture with Tesco, and has sold its portfolio for around $1.9 bn (EUR 1.5 bn at today's exchange rate).
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2) Union investment acquires Frankfurt development for EUR 93m

Union Investment has acquired a commercial building development in the German financial centre of Frankfurt from urban developer Vivico Real Estate for EUR 93 mln. The project is to be contributed to Union Investment's UniImmo: Deutschland open-ended real estate fund.

The completed building will have a gross floor area of approximately 34,000 m2, comprising around 23,000 m² of rental space and underground parking for 181 cars. The aluminium, glass and natural stone façade is designed to match the urban character of the boulevard, while integrated green spaces will be visible from the street. The architects responsible are Schneider + Schumacher. Completion is scheduled for 2010.

The transaction was brokered by Atisreal.

The six-storey office building is currently under construction by Vivico on the 'Nord 1' plot of Frankfurt's European Quarter, directly adjacent to the Mövenpick Hotel Frankfurt City. The ground-breaking ceremony took place on 28 October 2008.

Some 50% of the space has been let to BNP Paribas and Union Investment has signed a general lease with Vivico for the remaining space. Vivico is handling construction and marketing of the building itself.

The deal comes weeks after KanAm, another German open-ended fund manger, pulled out of the transaction of the trophy OpernTurm office development in Frankfurt. Market sources estimated the proposed transaction volume was in the region of EUR 500 mln. OpernTurm is 50% let and KanAm said it decided to pay it 'safe' given that it might be difficult to let the rest of the space due to the turmoil in the financial markets.

Fabian Hellbusch, head of communications at Union Investment, said there was no real comparison between the 42-storey OpernTurm, with 67,000 m² of lettable space, and the Vivico development . He pointed out that BNP Paribas has an excellent rating and Vivico is in charge of letting the building. 'The property is in one of the best locations in Frankfurt, a city that benefits from being a major trade show venue and added to the diversified nature of UniImmo: Deutschland,' he said.

Union Investment is one of the few managers of major German open-ended funds not to have imposed a freeze on redemptions in recent days. Hellbusch said that Union Investment does not see the need to suspend redemptions at the moment as its open-ended fund vehicles have very good liquidity. He noted that investors in general are a 'bit nervous' but Union Investment has not experienced the high rate of withdrawals of institutional money in recent days comparable to the situation at other German fund managers.

While Union Investment remains cautious, it is still looking for investment opportunities from the viewpoint of a long-term investor, Hellbusch added. 'UniImmo: Deutschland has a liquidity ratio of 40% equating to EUR 1 bn, so we can still operate and invest,' Hellbusch said.
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3) Nieuwe Steen acquires Swiss shopping centre for EUR 47m

Netherlands-based Nieuwe Steen Investments (NSI) has acquired the Perolles Centre shopping centre and apartments in the Swiss city of Fribourg for EUR 47 mln.

Built in the late 1990s in the heart of the city, the centre comprises 8,900 m² of retail space, 59 apartments and underground parking for 275 places. The annual rental income comes to EUR 3.3 mln, reflecting an initial yield of 7%. NSI said the transaction lifts its portfolio in Switzerland to EUR 100 mln. Johan Buijs, CEO of NSI, said: 'Further growth of the Swiss portfolio is desirable for reasons of efficiency and recognisability in the Swiss real estate market. It turns out that it is still possible to raise debt on the Swiss capital market at attractive conditions'.

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4) IVG fund acquires office property in Bristol for EUR 27m

An institutional fund of German real estate group IVG has acquired a prime office building in the UK city of Bristol for £21.9 mln (EUR 27 mln) from a fund managed by Invista Real Estate Investment Management. The asset is located at 1 George's Square, Bath Street in Bristol, with a prominent waterfront position overlooking a floating harbour. The property, comprising 6,378 m² of Grade A office space over six floors, is let to law firm Clarke Wilmott for 20 years until 13 March 2023 at a passing rent of £1.5 mln (EUR 1.8 mln) per annum.

The transaction price reflected a net initial yield of 6.65%.

CB Richard Ellis acted for IVG and King Sturge represented Invista.

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5) SEB acquires Segro park in Hungary for EUR 20m

Frankfurt-based SEB Investment has acquired the 30,000 m² Vendel Park located to the west of Budapest from flexible business space provider Segro for EUR 20 mln.

Segro acquired the site in December 2005 as part of its EUR 20 mln acquisition of the Central European property development arm of the company Grontmij. Phase one of the Park was completed in 2007 and has been fully let since February 2008. The second phase of the Park was completed in June 2008 and is 85% leased.

The Park is currently occupied by both Hungarian companies and international tenants including Gefco, Puma, Eurogate, Muller and Grundfos.

Inès Reinmann, Segro's chief operating officer for Continental Europe, said: 'Vendel Park was our initial entry point into the Hungarian industrial market. We have been very pleased with the development of the Park and the value that we have crystallised through its sale'.

Segro was advised by DTZ.