Eurocommercial Properties N.V. ("ECP") announces the opening of the Centro Leonardo in Imola, Italy, following a major refurbishment and extension of the gallery.
ECP acquired Centro Leonardo in 1998. In January 2005 ECP entered into an agreement with IGD, a listed Italian property company associated with the Coop, for the refurbishment of the existing gallery and the turn-key acquisition of a 9,000-m2 extension to the center, for which ECP was responsible for the merchandising, layout and leasing. Construction began on the extension in April 2005 and was completed and fully leased on schedule.
The completed gallery has an area of 15,300 m2 with 70 shops, including several large retail anchors such as Ipercoop, Media World, Oviesse, Pittarello and Bruman Sport. The center also has an attractive new food court and a total of 1,800 car spaces, 700 of which are covered. The total costs amounted to 47 million including the refurbishment of the existing gallery. This was slightly above original internal estimates, mainly due to the new 4% registration tax introduced by the Bersani Law and further improvements on the original project. The net return on cost of the Leonardo center is nevertheless slightly higher than 6.5%.
Commenting on the announcement, Jeremy Lewis, Chief Executive of Eurocommercial Properties, said: "At a time when the property market has become so competitive in Europe, ECP's extension and refurbishment programme adds high quality retail space and increased rental income to the portfolio at very attractive yields. We would expect, on recent market evidence, that Centro Leonardo would be valued at a yield of around 5%, which compares very well with the 6.5% achieved on the construction costs."
"Other projects in ECP's extension programme are on schedule, with the leasing campaign starting on the 11,300 m2 extension to Carosello, Milan and the two Swedish centers Skövde and Norrköping."
Source: Eurocommercial Properties