Singapore’s GIC puts €400m+ mall up for grabs

Singapore’s sovereign wealth fund GIC launched the sale this week of one of Italy’s largest shopping centres in a process expected to fetch well over €400 mln, PropertyEU can reveal.

GIC has hired Eastdil Secured in London to market the Roma Est shopping centre, which comprises 102,000 m2 of gross lettable area spread over 208 retail units, a hypermarket, 23 bars and restaurants and a 12-screen cinema.

The property, which is managed by CBRE GI, is arranged over two above-ground levels and has 10 large-area stores of over 1,000 m2 and nine mid-sized units between 500-1,000 m2. It is also served by a three-level car park with 6,750 spaces.

GIC took full control of the asset in October 2014 for a price of around €200 mln, reflecting a yield of roughly 6.5%. At the time, GIC already owned 50% of the scheme near Rome and was exercising a pre-emption right on the other half, which was held by a fund managed by CBRE Global Investors [CBRE GI had inherited the 50% stake as part of its takeover of ING REIM in November 2011].

GIC first teamed up with the ING Retail Property Partnership Southern Europe fund in 2008 to buy Roma Est from Italian food-retailing chain Gruppo PAM for €400 mln.

The surge in shopping centre investment into Southern Italy has been notable this year thanks to a number of big-ticket trades. CBRE GI in February gave the region a €135 mln vote of confidence with the acquisition of Gran Shopping Mongolfiera in Bari while Luxembourg-based group GWM and its partners spent €145 mln on Centro Sicilia – the largest mall on the Sicilian island.

Meanwhile, Blackstone’s Multi retail platform is currently marketing Forum Palermo through JLL with a price tag of €200 mln. One of the largest malls in the Sicilian city, the asset provides more than 48,000 m2 of gross lettable area over 124 shops and 2,500 parking spaces.

Although commercial real estate investment in Italy as a whole dropped by a quarter in the first nine months of the year, the retail sector witnessed an opposite trend showing a 22% increase in investment volumes in the same period.

Long-term investors and particularly retail specialists remain confident and are also taking some development or letting risk, according to Silvia Gandellini, head of retail investment at CBRE Italy. ‘New projects such as those of Westfield and Lend Lease in Milan are clearly an example, but also the recent acquisition of the 8 Gallery in Turin, where Axa and Pradera spent over €100 mln and assumed the letting risk on the expansion phase,’ she notes.

This article first appeared in EuroProperty, the weekly publication of PropertyEU.


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