Two of Finland’s largest pension funds, the pension insurers Varma and Elo, have merged two shopping centres they own to create a joint asset with a combined value of around €600m.
The Jumbo and Flamingo malls, located in the Aviapolis business park in the Finnish city of Vantaa, currently generate nearly €500m in sales annually, and, once completed, will form the largest shopping and entertainment centre in the Nordics, according to the pension funds.
Ilkka Tomperi, head of real estate investment at Varma, said: “Shared ownership enables us to better develop the whole to meet the needs of consumers and to strengthen the position of shopping centres in the changing competitive environment of the Helsinki Metropolitan Area.”
The funds said that Jumbo, currently owned by Elo which holds 70% of its shares, attracts around 12m visitors a year and Flamingo, 100%-owned by Varma, draws about 4.7m. The two malls are situated next door to each other and are joined by a corridor.
Varma and Elo will each hold 50% of shares in the combined property, with the leasable area totalling 140,000sqm.
Timo Stenius, head of unlisted investments at Elo, said: “Flamingo’s entertainment, restaurant and accommodation-based offerings have complemented Jumbo’s commercial offering and now we can join together to strengthen our overall customer base.”
Though Elo owns 70% of Jumbo, two premises on the first floor of the shopping centre — K-Citymarketissa and Prismassa — are owned by Finnish companies Kesko and HOK-Elanto respectively, who will continue as owners in the new merged centre.
The deal is subject to approval by competition authorities, Elo and Varma said.
Earlier this year, Elo doubled its stake in Jumbo to 70%, buying Unibail-Rodamco-Westfield’s 34% stake for €248.6m.
Earlier this year, Elo doubled its stake in Jumbo to 70%, buying Unibail-Rodamco-Westfield’s 34% stake for €248.6m.
