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PKM Investments buys two shopping malls in Bulgaria

PKM Investments buys two shopping malls in Bulgaria Galleria Burgas / All rights reserved.

SOFIA (Bulgaria), April 20 (SeeNews) – Luxembourg-registered PKM Investments, a joint venture of commercial property investor MAS Real Estate and Romania’s Prime Kapital, has acquired two shopping malls in Bulgaria for a total of 62 million euro ($66.8 million), MAS said on Thursday.

The shopping malls are located in Burgas and Stara Zagora, Bulgaria’s fourth and sixth largest cities, respectively.

The vendor of the mall in Stara Zagora is Polish real estate developer Globe Trade Centre (GTC), which is also the seller of the mall in Burgas jointly with the European Bank for Reconstruction and Development.

“This transaction is in line with our plans to expand in to markets with growing economies across Central and Eastern Europe by acquiring accretive income-generating assets with real upside potential through our joint venture with Prime Kapital,” Lukas Nakos, CEO of MAS, said in a statement.

“The transaction increases our income-generating property portfolio by 15.3%, from 406.4 million euro to 468.4 million euro,” Nakos added.

MAS' effective economic interest in the acquisition is the equivalent of an 80% direct participation in the performance of the malls and a 20% participation at the weighted average cost of funding achieved by the acquisition in line with the previously announced co-investment agreement with Prime Kapital, the statement reads.

Galleria Burgas mall benefits from a total catchment area of approximately 480,000 people within 60 minutes’ drive, as well as a significant number of tourists during the summer holiday season. Galleria  Burgas has  a  broad  tenant  mix  consisting  of  115  tenants  including  primarily international   fashion   and   entertainment   brands, including   Bershka,   CCC,   Cinema   City, Deichmann,  H&M,  Humanic,  Ikea,  Intersport,  LC  Waikiki,  Lee  Cooper,  Lidl,  Massimo  Dutti, Oysho, Terranova and Zara.

“Due to strong performance and tenant demand, a significant centre extension is being considered with the intention to enhance the earnings from this asset,” Nakos said.

Galleria Stara Zagora benefits from a total catchment area of approximately 400,000 people within 45 minutes’ drive. The tenant  mix  is  focused  primarily  on  fashion  and entertainment and consists of 71 tenants, including Bershka, Cinema City, CCC, Deichmann, DM, H&M, Intersport, Kenvelo, LC Waikiki, New Yorker, Nike, Pull&Bear and Stradivarius.

“Galleria Stara Zagora is in need of refurbishment and offers value enhancing opportunities through operational streamlining and commercial layout improvement,” Nakos added.

Bucharest-based Prime Kapital is an owner-managed, vertically-integrated, real estate developer, investor and operator. The company focuses on development of retail property in the CEE region, but also undertakes developments and acquisitions outside its asset-class or area of focus.

MAS Real Estate, registered in the British Virgin Islands, is listed on the Main Board of the Johannesburg Stock Exchange and on the Euro MTF market of the Luxembourg Stock Exchange.

($ = 0.9279 euro)

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