A joint venture between UK-based mall owner Intu Properties (Intu) and Canada Pension Plan Investment Board (CPPIB) has purchased Parque Principado Shopping Centre, a 75,000-square-meter retail center in Oviedo, northern Spain for €162 million ($219.7 million) before transaction costs.
Intu will assume the asset management of the property. After the purchase, the investors intend to secure bank financing of approximately 50 percent of the property value, according to an announcement from Intu. Based on net income of €11.7 million, the implied net initial yield at the purchase price is 7.2 percent, the company said.
"The opportunity to acquire Parque Principado, a top 10 center in Spain, on attractive and earnings accretive terms firmly establishes our presence on the ground in a country where we see considerable growth opportunities in the regional shopping center industry," David Fischel, chief executive of Intu, said in the release.
The single-story, Parque Principado opened in 2001 and includes 156 retail units. It is anchored by Primark, Zara, H&M, Cortefiel, C&A, Mango and an Eroski hypermarket. It features 20 percent of catering and leisure space, a 12-screen cinema and 20 restaurants.
The center has a 97 percent occupancy rate with an average unexpired lease term of six years, Intu said.