Allianz makes Swedish debt debut

Allianz Real Estate has originated its first loan in the Swedish market, to refinance a shopping centre in the city of Karlstad.

The German insurance firm has provided a kr690 million (€73 million) loan to refinance the Bergvik shopping centre for its owner, Eurocommercial Properties. As well as being the firm’s first Swedish debt deal, the transaction is also its first with the sponsor, a Euronext Amsterdam-listed property company which focusses on the French, Italian and Swedish markets.

The Bergvik shopping centre comprises around 33,000 square metres and is anchored by supermarket chain Coop as well as 70 additional tenants. Eurocommercial has owned part of the asset since 2005 and acquired the fully-refurbished second part late in 2015, doubling its ownership.

Last year’s deal saw the firm buy the Coop store and 8,000 square metres of shops from Konsum Värmland for kr600 million (€64.6 million), a net initial yield of 5.3 percent. The acquisition brought the value of Eurocommercial’s holding at Bergvik to kr 1.289 billion (€139 million), implying that the Allianz loan has a loan-to-value ratio in the region of just more than 50 percent.

“This transaction presented a good opportunity for Allianz Real Estate to close a first financing deal with Eurocommerial in Sweden and to further diversify the investment portfolio geographically,” said Helmut Muehlhofer, head of the debt team in Munich.

German lenders are increasingly targeting debt deals in the Nordic markets, in order to take advantage of higher margins than in their domestic market. German bank Helaba recently established a representative office in Stockholm.