CBRE has advised Starwood Capital Group on the acquisition of seven prime location retail parks and shopping gallerias in Sweden from Kooperativa Förbundet, a leading Swedish retail group, for approximately SEK 3.9 billion (approx. €440 million).
Located throughout Sweden’s four largest cities−Stockholm, Gothenburg, Malmo and Uppsala−the seven properties comprise of circa 205,000 m² of retail space. The transaction also includes existing building rights for an additional circa 70,000 m² spread over three of the locations.
The properties are currently 96% leased and each location is anchored by a Coop, Sweden’s second-largest supermarket chain. In addition to Coop, the tenant line-up includes many well-known Swedish and international retailers such as XXL, MediaMarkt, H&M and Systembolaget. As part of the transaction, Starwood has extended the Coop leases at four of the seven locations, nearly doubling the weighted average unexpired lease term to 10.1 years.
John Welham, Head of European Retail Investment, CBRE, commented: “We are delighted to work with Starwood Capital Group on their expansion plans into Sweden. The acquisition of established retail centers with good upside potential represents a savvy move. Broader economic recovery in Europe is starting to manifest in improved retail sales and consumer confidence, with the Nordics and particularly markets such as Sweden performing consistently well. The improved economic outlook, combined with tight development pipeline, gives a backdrop for active asset management to drive stronger rental growth.”
According to CBRE research, total European retail investment is on the rise, growing to €8.3 billion in Q3 2013 - an 11.5% increase on the previous quarter and the highest quarterly total to date this year. Investment activity is broadening, both geographically and in terms of asset quality, with the Nordics markets seeing an increase of 25% on the previous quarter.
Aareal and Helaba are acting as Joint Arrangers of the financing, Aareal Bank carries out the role as Facility Agent and Security Agent. CBRE, Nordier and Lindahl also advised Starwood and Vencom on the transaction.