August 7 (SeeNews) - Property investment and development group NEPI Rockcastle said on Friday it has received a 15 million euro ($17.7 million) cash advance from AFI Europe as guarantee for finalizing the purchase of its office building portfolio in Romania.
The total transaction value amounts to 307 million euro, with a cash price of 290 million euro after specific adjustments, NEPI said in a press release.
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In accordance with the provisions of the new agreement, the takeover of the office portfolio by AFI is scheduled to be completed by December this year, with the completion date to be set by the purchaser. As a result of this process, the parties have also settled the arbitration initiated as a result of the interruption of the previous transaction, NEPI added.
The portfolio consists of four Class A office projects: Floreasca Business Park, The Lakeview, Aviatorilor 8 and Timisoara City Business Center. The four projects comprise eight office buildings in Bucharest and Timisoara with a total gross lettable area of 118,500 sq m.
Dutch-registered real estate developer AFI Europe announced the purchase on Thursday, adding that after the transaction and the completion of ongoing office developments, it will have close to 300,000 sq m GLA office spaces under management, becoming one of the largest office owners in Romania.
In July, NEPI said that it has signed a non-binding memorandum of understanding with AFI Europe which allowed it to resume negotiations for the disposal of its Romanian office property portfolio. In April, NEPI announced that the disposal of its Romanian office property portfolio was not completed as the buyer - AFI Europe - had failed to fulfil some procedures, leading to a breach in the agreement signed several months earlier. In December, AFI Europe announced that it has signed a deal for the purchase of NEPI's Romanian office portfolio for over 300 million euro.
AFI Europe, a subsidiary of AFI Properties, is a real estate development, management and investment companies operating in Central and Eastern Europe since 1997. AFI Europe operates in Romania since 2005.
On the office segment, AFI Europe Romania is the developer and owner of AFI Park 1-5 and AFI Tech Park, both located in Bucharest, and AFI Park Brasov, in the center of Brasov which will be inaugurated this autumn.
NEPI Rockcastle is a property investment and development group incorporated in the Isle of Man which is listed on the Johannesburg Stock Exchange and Euronext Amsterdam. The company is focused on acquiring, developing and managing retail assets in Central and Eastern Europe. Its property portfolio is focused in Romania, Poland and Slovakia. The group has strong presence in Croatia, Bulgaria, Hungary, the Czech Republic, Serbia and Lithuania.
($=0.8427 euro)