Dutch pension fund PGGM's private real estate arm has joined forces with European retail specialist Redevco to launch a €550 mln European commercial real estate joint venture to be known as Urban Retail Ventures.
The two partners said that Urban Retail Ventures will invest in the 'most favourable' shopping and leisure destinations in Europe, focusing on cities that are winning the battle as quality retail locations.
The joint venture is seeded with the acquisition of the 30,000 m2 open-air Promenade Sainte-Catherine retail-led scheme in the centre of Bordeaux. The property required an investment of €105 mln, Redevco said when it unveiled the project in 2011.
Urban Retail Ventures plans to focus on Europe's most successful retail destinations with the selection of these economically thriving hotspots being based on Redevco’s City Attractiveness research model. The PGGM and Redevco joint venture is also committed to reduce the footprint of the portfolio to zero carbon in 2030.
Andrew Vaughan, Redevco’s CEO, said: 'This joint venture brings together Redevco’s proprietary ‘City Attractiveness’ research model and specialist retail market investment teams across Europe, with the deep financial resources and expertise of PGGM, one of the top-10 largest global institutional real estate investors. By combining big data factors and in-depth local knowledge, we can pinpoint those city and micro-locations that can produce a "halo effect" allowing premium operators in these sectors to maintain their edge over mid-market competitors, making these destinations the most likely winners in the current retail landscape which is both innovating and being disrupted at an astonishing speed.'
Mathieu Elshout, senior director private real estate at PGGM, said: 'As a long-term investor we believe in this research-driven approach. The aim is to make this portfolio completely carbon neutral by 2030, which will include the emissions of our retail tenants. A ground-breaking ambition in the private real estate space, which as a responsible investor we feel is the way forward.'
This is Redevco's third European retail real estate joint venture following earlier partnerships with UK institutional investor Hermes and US private equity firm Ares. Redevco will be responsible for the asset management of Urban Retail Ventures.