Eurocommercial Properties N.V. announced that it has reached an agreement to invest in one of the most important shopping centers in Northern Italy, following the agreement to purchase the balance of I Gigli, Firenze and the start of the construction at Halmstad, Sweden.
The Company will acquire a 50% share of the Milan region center’s gallery, together with an adjoining retail park, for a total price of €135 mln reflecting a net initial yield in the order of 5.8%. The center has a total floor area of 55,800 m², including an 11,800 m² hypermarket and 12,000 m² of external retail units. The purchase is expected to be finalized by the end of 2015. Full details will be announced when the legal formalities are completed. Mediobanca acted for the vendor in the transaction and Jones Lang LaSalle for Eurocommercial.
In February 2015 Eurocommercial announced that it will complete the purchase of the hypermarket and parts of the gallery it does not already own at I Gigli, Firenze (82,787 m²) in April 2016 for €82 mln. Additional costs to convert part of the hypermarket into gallery shops and refurbish the entire shopping center are expected to total approximately €18 mln. The leasing of the new gallery space is advanced, including negotiations with two major international retailers for large units which will ensure I Gigli retains its position as the most popular shopping center in Italy with 18.7 million annual visitors.
In Sweden, following planning approval, work has commenced on the €75 mln extension of Eurostop in Halmstad. The petrol station is being relocated to allow for an enlargement of both the center and the car park and will provide much better access to the north side of the center. An additional lettable area of 16,000 m² will be built over the next two years and the pre-leasing programme is progressing well. A net yield on cost of 7% is expected from the extension, which will bring the center to a total of 47,500 m².
Source: Eurocommercial Properties