TK Development has concluded an agreement to develop and sell the Galeria Copernicus shopping centre in Torun, Poland. The buyer is the Central European investment company Meinl European Land Ltd., which is listed on the Vienna Stock Exchange.
The sales price for the Galeria Copernicus is expected to total €49 million (DKK 365 million), based on a return of about 8.75 % for the investor. The sale is based on a forward funding model that provides for payment by instalments in step with the completion of construction.
The final terms and conditions are expected to be conclusively negotiated in January 2005, after which construction is scheduled to start. A building permit has been obtained, and the centre is expected to open at the end of 2005.
Galeria Copernicus is centrally located in the Polish city Torun, which has 250,000 inhabitants. The centre will cover 33,000 m² and include a 22,000 m² gallery with 90 stores as well as a hypermarket operated by REAL, a German hypermarket operator.
This is the first time that TK Development has entered into a hypermarket agreement with REAL, one of Poland’s leading hypermarket operators.
International retailers have shown considerable interest in the centre, and the occupancy rate is currently about 60 %. Moreover, conditional lease agreements for a further 20 % of the centre are in place.
The sale of this Polish shopping centre supports the expectation outlined in stock
exchange announcements nos. 22, 23 and 25/2004, according to which the Central European market in particular will contribute higher profits in the 2004/05 financial year than previously assumed. In addition, the agreement to develop and sell the Galeria Copernicus in Poland is anticipated to generate substantial earnings in the 2005/06 financial year.
In the course of December 2004, the Group has concluded three agreements regarding Central European shopping centres, reflecting a marked improvement in the sales potential and pricing of projects in Central Europe.
The agreement to develop and sell the Galeria Copernicus in Poland underpins Management’s expectations for a breakeven result of about DKK 0 after tax for the 2004/05 financial year.