Unibail buys 50% stake in Centro mall for €535m

Franco-Dutch property giant Unibail Rodamco has signed an agreement to acquire a half-share in the massive Centro Oberhausen shopping centre in Germany from developer Stadium.

Under the deal, Unibail will own the scheme jointly with the Canada Pension Plan Investment Board (CPPIB), which in May 2011 bought a 50% stake in the €1.3 bn 'super-regional' centre for €270 mln.

Unibail-Rodamco expects to pay up to €535 mln, of which €469 mln upon closing. The transaction represents a net initial yield of 4.4% and an average price of €7,800/m2. The purchase will be financed from existing bank lines.

'We are delighted to significantly strengthen our position in Germany and team up with a highly experienced real estate partner such as CPPIB. We believe it reflects confidence by CPPIB in Unibail-Rodamco's best in class operating management skills,' said Unibail-Rodamco CEO and chairman Christophe Cuvillier.

Located in Oberhausen, CentrO is one of Germany's largest and most successful shopping centres. Opened in 1996 and extended by 17,000 m2 in 2012, CentrO features 232,000 m2 of retail and leisure offer, including a two-storey 117,000 m2 shopping centre, 39 restaurants, a nine-screen cinema, a 12,000 seat multi-purpose arena, two adventure theme parks and 12,000 parking spaces.

Unibail-Rodamco said the acquisition represents a 'unique opportunity' to further accelerate the group's expansion in Germany, following the 2012 acquisitions of stakes in mfi, Germany's second largest shopping centre owner, developer and operator, and in Ruhr-Park, one of Germany's largest malls.

Following closing, the group's German platform will include 1.5 million m2 and 27 malls, of which 20 are managed for third parties by mfi. In addition, mfi plans to deliver the Recklinghausen, Mönchengladbach and Osnabrück developments between 2014 and 2016 for an additional 110,000 m2 of gross lettable area.