Castellana Properties (YCPS.MC), the Spanish subsidiary of South African REIT Vukile, has approved the acquisition of Morzal Property Iberia, S.L., owner of a portfolio of four shopping centres in Spain, originally purchased from Unibail-Rodamco-Westfield on July 31st, 2018. As a result, the JSE-listed retail-focused REIT now has 46% of its total 32.3bn rand portfolio in Spain and 4% in the UK through Atlantic Leaf. The remaining 50% is held in Southern Africa.
Castellana Properties has purchased 100% of Morzal´s shares executed through a capital increase subscribed by a non-monetary contribution of the shares in Morzal’s share capital, at a price of €6 per Castellana Properties’s share, which makes Morzal a 100%-held subsidiary of Castellana Properties.
Alfonso Brunet, CEO of Castellana Properties, explains: “This transaction, which doubles the company’s assets under management to reach a total of around €900M, is an important step forward for the Company. The acquisition of four shopping centres allows us to significantly strengthen our portfolio, diversifies our tenant mix and retail offering, and reaffirms our commitment to retail real estate in Spain”. Castellana Properties currently has a weighted average unexpired lease term of nearly 15 years with 92% of rentals coming from recognised national and international retailers. Following this deal, Castellana Properties has added the following shopping centres to its portfolio: Los Arcos in Seville, Bahia Sur in Cadiz, El Faro in Badajoz and Vallsur in Valladolid. These four centres have a total GLA of over 121,300 m2.
This transaction increases Castellana Properties’ average asset value from €27M to €48M and reduces its portfolio vacancy from 3.3% to 1.8% and increases its lettable area from 197,322 m2 to 318,622 m2.