Corio acquired 75% of the shares of the factory outlet development Moulin de Nailloux in the Toulouse region for 44 million, at a net yield of 8.4%, for the first phase. The remainder of the shares is owned by the development company COGEP (local developer). Corio has the possibility to acquire the remaining 25% of the shares at market value after 6 years. Phase one of the project is expected to open in 2011. The project will be part of Corio's fixed committed pipeline.
Total gross leasable area (GLA) (for phase one and two) will be 30,900 m². At completion of both phases Moulin de Nailloux will have 125 shops and 1,800 parking spaces. Phase one will be 70/80 shops on a GLA of 22,100 m². When the first phase has been proven to be successful, the second phase of 8,800 m² will be carried out.
The projected architecture and lay-out of the site are of a high quality and well designed. The letting of the project has already started, currently 21% of leases have been signed and for 12% of the leases Heads of Terms have been signed. The project is located along A66 motorway at exit 1, which is 15 minutes from the Toulouse ring road and 30 minutes from the city centre which makes it is highly visible and accessible. Advantail is responsible for the concept, leasing and will perform the management (subject to performance targets) of the center.
Toulouse agglomeration has now 1.12 million inhabitants with 437,100 in the city center. It is the fourth French city by size. INSEE (French national statistic) anticipates 21.8% increase in population over 2005-2030. The city is above the national average in terms of GDP growth, income per capita and working population percentage. Total catchment area (90 minutes) for the center, is 2.3 million people.
There is no other factory outlet in the Toulouse region. The closest competitor is in Bordeaux at 300 kilometers distance. Due to difficulty to get authorisations and long development time needed, it should be difficult to develop another factory outlet centre in the region especially because Moulin de Nailloux will get critical size and retail brands are not likely to multiply their outlets within the catchment area.