Paris, France: Few investors commit €400m to a single idea unless they believe the best of it is still ahead. That is the bet Antoine Frey's FREY has struck with Singapore-backed GIC, forming an equity partnership to buy premium retail parks across Western Europe and Poland. The vehicle, announced on 12 November, is designed to accelerate FREY's pan-European growth, recycle capital and create long-term value for shareholders.
GIC will hold 80% of the vehicle, while FREY keeps 20% and runs it as operating partner. Anyone hoping to join the table later may find the seats already taken: the platform will target existing, medium-sized premium retail parks of between 5,000 m² and 35,000 m² of gross leasable area, and FREY will keep pursuing deals outside that range through its own balance sheet.
The vehicle does not start from a blank page. FREY will contribute a seed portfolio of three retail parks worth around €176m in aggregate: Woodshop in Cesson, France (34,222 m², acquired in 2016), Parque Mediterraneo in Cartagena, Spain (57,768 m², acquired in 2022) and Algarve Retail Park in Albufeira, Portugal (13,402 m², acquired in 2019). Images of the three assets were supplied by FREY.
"This is the perfect time to accelerate our investment strategies. Premium retail parks remain attractively priced and should continue to deliver strong organic growth as they perfectly respond to consumers' growing demand for open-air, experience-led and convenient retail destinations," said Antoine Frey, chairman and chief executive of FREY. The deal fits a strategy built on two asset classes, premium retail parks and outlet villages, and will be consolidated using the equity method in FREY's accounts.
"This partnership enables FREY to benefit once again from third-party capital to seize new investment opportunities in Europe. Our business plan for this vehicle translates into some accretive impacts on EPS and NAV from 2027 onwards," added Sebastien Eymard, group deputy chief executive of FREY. The phrase "once again" signals that FREY is leaning on outside capital as a repeatable growth tool, with an operator that manages more than 40 destinations in 10 countries, over 1.2m m² of retail space and €2.7bn of assets (group share).
What the announcement leaves unsaid may matter most to investors and developers. Parque Mediterraneo, at 57,768 m², is far larger than the 35,000 m² ceiling set for future acquisitions, though the release does not say whether that figure is gross leasable area or total site area. It also gives no pricing or yield guidance, no leverage assumptions and no fee structure, and it does not say how quickly the €400m will be deployed. Those details will show whether the platform can compete for assets against other buyers, and whether developers of new retail parks gain a ready exit route.
People mentioned
- Antoine Frey: chairman and chief executive officer of FREY
- Sebastien Eymard: group deputy chief executive officer of FREY
Companies mentioned
- FREY: listed European operator of premium shopping destinations; 20% stakeholder and operating partner in the new vehicle, and contributor of the seed portfolio
- GIC: global long-term institutional investor, established in 1981 to manage Singapore's foreign reserves; 80% stakeholder in the new vehicle
Image source: FREY (Parque Mediterraneo located in Cartagena (Spain) with a surface area of 57,768 sqm, acquired in 2022)
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