REAL ESTATE - Real estate investor Rodamco Europe has set a first step onto the Moscow property market, by acquiring a 50% stake in the retail centre-under-development Metropolis, it has announced.
Its investment of €200m in the ‘top-quality pipeline project’, with a total surface of 80,000 m2, will generate net initial returns of 9.6%, it said. Rodamco has bought its stake from the international developer and investor Capital Partners.
The development of Metropolis has recently started and is to be completed in the second quarter of 2008. Rodamco will acquire the centre turn-key and let out, it said.
The transaction will be completed after all necessary licences have been obtained, probably during the first half of 2009, it added.
According to Rodamco, Metropolis is situated in a densely populated area with the highest earners in the north of Moscow. "It lies near an important public transport hub and along a future fourth ring road," it said.
"With over 10m inhabitants, of whom one-third are higher earners, Moscow is continental Europe’s second largest shopping city," Rodamco explained.
"Due to the influx of international investors and retail chains, the strong growth of GDP and the promising economic prospects, the Russian real estate market has seen a considerable development during recent years."
"Because of its excellent position, size and mix of retail branches and tenants, Metropolis is expected to become one of the best and most dominating retail centres of Moscow. We are expecting much interest from national and international retail chains," Rodamco added.
"This first investment in Moscow is an important milestone on our new-markets strategy for Central Europe," Rodamco’s CEO Maarten Hulshoff commented.
"Due to the expectations for economic growth, the increasing presence of international retail chains and the maturing of the property market, we are convinced that this is a right moment to enter the Moscow retail market with a top-quality retail centre, and in cooperation with a valued partner."
"This transaction is a new landmark in our strategy to long-term participation in important projects, and to start a partnership with leading multinational real estate investor, who offers more added value than just providing capital," Capital Partners CEO Erkan Erkek said.
Rodamco Europe is the largest listed real estate investor and manager in the European retail sector. Capital Partners has already developed the 5-star Ritz-Carlton Hotel in Moscow. It will remain 50% stakeholder. Rodamco will take care of the retail management of Metropolis.