Citycon has acquired the shopping center Arabia in Helsinki, for 19.5 million from Tapiola Group. Shopping center Arabia is located in the fringe of Helsinki's city center, some 4 km northeast on a lot owned by the City of Helsinki.
The shopping center has a gross leasable area of approximately 14,000 m², with 11,400 m² of retail premises. The net initial yield on the acquisition price is around 6% but it is expected to grow rapidly to 7% after planned commercial development actions.
Arabianranta is a former industrial area that has been converted into an urban residential and campus area in the past decades. Around 13,000 inhabitants live in the Arabianranta area and thousands of homes have been built there during the last 10 years and further homes are under construction.
Rich in cultural history and modern community living the Arabianranta area at the moment employs 6,000 people and offers 13,000 students a place to study. It is a part of Helsinki's tram and bus network.
"The excellent location of the center with good public transportation connections and its situation among a demographically strong, urban living, working and studying environment brings growth potential in daily footfall.
"Our aim is to reach this potential with active development: we will both increase and diversify the offering of the center. The center fits Citycon's strategy like a glove: we invest in shopping centers located in growing city centers," says Michael Schönach, Head of Citycon's Finnish Operations.
Citycon financed the acquisition from its existing credit facilities. The acquisition will increase rental income and improve the profitability of Citycon's Finnish operations. It is also expected to be earnings per share accretive.
Following the acquisition, Citycon owns 36 shopping centers and 41 other retail properties in Finland, Sweden, Estonia and Lithuania. In addition, the company manages and leases two shopping centers without owning them. In Finland, Citycon owns a total of 23 shopping centers after the acquisition.
Source: GlobeNewswire
