Corio has signed an agreement for the acquisition of a 100%-interest in "Adacenter" shopping centre (photo) currently under development in Adapazarý for approximately USD 65 million. In addition, Corio has been invited to take a 7%-interest in the potentially large scale project Acibadem which will be developed in Istanbul. The transactions are forecast to generate a net yield of at least 8% in the first full year of operation.
Adacenter will comprise approximately 25,000 m² gross lettable area ('GLA'). The opening date of the shopping centre is expected not to be later than the first quarter of 2008. Adapazarý is the capital of the Sakarya province and is located in the north-west of Turkey, approximately 150 kilometres east of Istanbul. Due to the ongoing urbanization process in Turkey, the population of cities like Adapazarý is growing very fast. Adapazarý has assumed increasing economic importance as the center of north-western Turkey's industrial heartland. There is also a large automobile factory owned by Toyota Motor Corporation and a university. The per capita income and consumption is growing relatively faster than the Turkish averages.
AdaCenter is located in the Erenler district, in the southern part of Adapazarý, approximately four kilometres from the city centre, next to the road connecting the city centre with the Ankara Istanbul highway. The centre will have a primary catchment area of 350,000 inhabitants. AdaCenter will be the first shopping centre in the region and comprises approximately 25,000 m² of gross lettable area divided over two floors, and 1,100 parking spaces in the basement and surrounding the shopping centre. The ground floor will be anchored by a hypermarket, for which several (international) parties have shown serious interest. The hypermarket will be surrounded by shops and a department store. On the first floor, next to more shops, a cinema, a kids land and a food court are planned.
The lease contracts in this shopping centre will, as usual, be based on the US Dollar. Corio will be responsible for the management of AdaCenter. The plot size offers the potential to extend the centre in the future. The developer and vendor of the centre is Miratur. Miratur was established in 2006 by the shareholders of Eko Construction and Trade Co. Ltd., located in Ankara. Eko Construction and Trade Co. Ltd. is one of the main construction groups in Turkey.
Corio will acquire a 100%-interest in AdaCenter for approximately USD 65 million (including acquisition costs). 30% of the total investment will be paid after having received approval of the Turkish Competition Board. The remaining 70% will be paid upon completion of AdaCenter (expected not to be later than the first Corio, acquisitions in Turkey 1 March 2007 quarter of 2008). This transaction is subject to approval of the Turkish Competition Board. Although there are no other remaining material suspensive conditions for this project, until this approval has been received, the project will be included in the variable pipeline.
Corio also has been invited to take a 7%-interest in the Acibadem-project which will be developed in the geographical heart of the Asian side of Istanbul in the Uskudar district, close to the Kadiköy district. The Acibadem project is expected to have as a core a regional shopping centre with parking, leisure and residential units. The expected delivery date of the project will be not before 2010. The Acibadem project is well located at the E5 highway, with good connections to the Trans European-Mediterranean (TEM) highway, connecting Edirne, Istanbul and Ankara. Furthermore the Kadiköy Kartal subway is under construction with a station near the shopping centre. The project is currently in the design phase whereby Corio has the opportunity to contribute its broad retail experience. Corio participates in this development with local partners and hereby expands its network and experience in Turkey. This transaction has already been approved by the Turkish Competition Board, as a result of which the investmen
