Unibail-Rodamco crosses borders in €715m retail deal

Europe’s largest REIT, Unibail- Rodamco, has spent €715m on seven shopping centres and a half share in five yet to be developed, in one of the largest cross-border property deals since the credit crunch. The interests were sold to the French REIT by retail property company and developer Simon Ivanhoe, a joint venture between US REIT Simon Property Group and Ivanhoe Cambridge, the retail subsidiary of Canadian pension fund Caisse de Dépôt et Placement du Québec. Mark Eagan of law firm Paul Hastings, which has advised the seller on the transaction since September, said the off-market deal was a good one for all parties: “Unibail pursued this unique portfolio, which was unusual in today’s market given its size and cross-border nature.” The centres are in France and Poland, two continental markets attracting most interest from investors. The deal was financed with existing debt facilities.

Two of the developed schemes are in Poland, including the largest, the 103,000 sq. m Arkadia in Warsaw. Unibail-Rodamco is rebalancing its portfolio towards larger retail schemes and has just sold five mid-sized Dutch shopping centres to Wereldhave, for €250m. It is the Dutch company’s first acquisition on home territory for several years. Eagan said Ivanhoe Cambridge is looking to buy more retail and retail-led, mixed-use property in Germany, Spain and the UK. Simon Property raised $300m of equity in this latest deal and last month raised an additional £1.4bn on the bond market (see p27). It has just made a $10bn offer to buy bankrupt US retail REIT General Growth Properties.