British REIT intu Properties plc has sold Puerto Venecia shopping centre to Generali Shopping Centre Fund SCS Sicav-SIF, for a total of €475.3 million. intu’s share is €237.7 million, with the rest going to Canada Pension Plan Investment Board.
intu’s share price, which 3 years ago traded at close to £300 has plummeted to £33per share due to a significant weakening in the British retail sector where it owns sites such as prime mega malls like the Lakeside and Trafford shopping centres.
In July, intu skipped its interim dividend and forecast a nearly 10% fall in rental income for 2019. It has already sold a number of assets this year to help reduce debt, much of which matures in the next few years.
Union Investment and Generali Real Estate have signed the agreement as part of a 50%-50% joint venture. Union Investment will aquire its 50% share for the open-ended real estate fund, Unilmmo: Deutschland whilst Generali Real Estate will acquire its 50% on behalf of Generali Shopping Center Fund SCS. The buyers have been advised by “Axis Retail Partners”, a Generali Investments Holding boutique.
With around 19 million visitors a year, Puerto Venecia is one of the top 5 shopping destinations in Spain. The property has a GLA of c. 120,000 square metres and includes a shopping centre with over 190 retail units and a retail park.
The largest owner and manager of prime shopping centres in the UK has declared that the sale is part of its plan to «fix» its balance sheet, with the proceeds of the sale going towards reducing debt. The REIT kicked off its plan to sell three Spanish assets in November: Puerto Venecia, intu Asturias, and intu Xanadu.
According to the group’s CEO, Matthew Roberts, the firm is «pleased to have successfully concluded this transaction and, as previously discussed, are at advanced stages of negotiations on the disposal of intu Asturias in northern Spain.» In addition, the CEO states the fund’s «number one priority is fixing the balance sheet which includes creating liquidity through disposals. This transaction, which along with the part-disposal of intu Derby and other sundry asset sales in 2019 brings the year to date disposals total to £479 million.»