TK Development has concluded an agreement to sell the Galeria Pomorska shopping center in the Polish city Bydgoszcz to a UK investment company. The first instalment of the purchase price has been deposited, and the sale is expected to be completed in January 2005.
With its approx. 37,000 m2, Galeria Pomorska is one of the largest shopping centers that TK Development has developed in Central Europe. The center, which opened in April 2003, consists of a specialty section with about 90 stores plus a hypermarket section.
The sales price is about € 41 million (about DKK 305 million), based on a 9 % return for the investor.
The Dutch hypermarket operator Royal Ahold previously owned 33.3 % of the center and also operated the hypermarket. As stated in the Semi-Annual Report of 30 September 2004, the French hypermarket operator Carrefour has taken over operation of the hypermarket. In connection with this change of operator, TK Development’s Central European subsidiary, Euro Mall Holding, acquired Royal Ahold’s stake in the centre and subsequently sold the hypermarket section to Carrefour.
The shopping center has been sold to the investor at a considerably lower return than previously used by TK Development in the valuation of its Central European investment properties. Thus, the effect of increased investor interest has become apparent, resulting in a higher sales price for this center.
The sale of this Polish shopping center underpins the expectation outlined in stock exchange announcement no. 22/2004 according to which the Central European market in particular will contribute higher profits in the 2004/05 financial year than previously assumed.
Management still anticipates a breakeven result of about DKK 0 after tax for the 2004/05 financial year.
Source: TK Development