Pradera

Italy and Spain’s emerging out-of-town markets have been the focus for Pradera’s European Retail Fund, but it is also looking to gain a foothold in the French market Fund manager Pradera was founded in 1999 to raise and manage a specialised fund giving institutional investors exposure to out-of-town retail property in the eurozone. Henderson Global Investors, a member of the AMP group of Australia, is a 50% shareholder. The main fund managers are Paul Whight, former founder and chairman of UK retail warehouse developer Grantchester, and Colin Campbell, previously a Parkes and Co director, where he handled the European investment activities of US opportunity fund DLJ Real Estate Capital Partners. Pradera’s fund, the Pradera European Retail Fund, started by acquiring a portfolio of seven shopping centres in Italy, Spain and Portugal from Carrefour, the world’s second biggest retailer. “Those were the first properties Carrefour ever sold, so it was a ground-breaking deal,” says Whight. Acquisition of the Carrefour portfolio allowed Pradera to market a fund with specific properties, as opposed to a blind fund. “We secured €225m of equity from around seven British, Dutch and Austrian institutional investors, including Equitable Life, Pearl Assurance, PGGM and Wiener Staedtische,” says Whight. At the start of 2001, Pradera bought the 20,000m2 Village Entertainment Park in Athens for around Û57m. The scheme, Athens’ flagship out-of-town shopping and leisure project, has 45 shops, restaurants, bars and a Village Roadshow multiplex. By the end of 2001, Pradera had completed or contracted to buy six further properties worth Û264m in total. These included the €70m forward funding of a 33,000m2 retail warehouse park being developed by Gruppo MaccaFerri and Galotti at Citta Scambi on the north east of Bologna, Italy. The park, the largest of its kind in the country, is due for completion next year. Also in Italy, Pradera bought shopping centres in the Milan area, at Gallarate and San Giuliano Milanese, for €12m. In Spain, Pradera acquired an 80% stake in Parc Valles Entertainment Centre, Terrassa, near Barcelona, from developer Eurofund Investments for around €60m, retaining the vendor as a minority shareholder and as asset manager. The 46,000m2 retail and leisure scheme opened in 1997 and is anchored by an AMC multiplex. Pradera has also provided €50m in forward funding for the 26,800m2 Cuadernillos retail and leisure park at Alcal… de Henares on the edge of Madrid. Director Colin Campbell says: “We are raising new capital to take our fund’s total equity up to €400m. With gearing, we aim to end up with an €800m portfolio by the end of 2003.” Pradera’s portfolio is worth around €450m. “We are focusing on Spain, Italy and Greece with the possibility of investing in Portugal,” says Campbell. “They are among Europe’s newer out-of-town retail markets. We also invest in France, although it is a mature market,” he adds. For example, Pradera has just signed a forward commitment on the first phase of a retail project near Lille for around €60m. “We plan to be fully invested by the end of 2003, and then to add value through extensions to the centres,” says Campbell. “If we cannot improve our centres, then we will sell them.” At the end of 2005, Pradera will start looking to dispose of the fund’s portfolio in whole or in part, subject to extension of the fund by investors. According to Whight: “We have the ability to re-invest our capital until the end of 2005. We may sell during 2004 to re-invest in 2005. We are not a one-fund business – this is just our first. Once one is fully invested, we will start another.” Selected recent acquisitions Pradera has been on a spending spree in Italy and Spain Contracted acquisitions €m Citta Scambi Retail Park, Bologna 74.8 Loisinord 2, Noeux-les-Mines, Lilles 68.5 Cuadernillos Fun and Retail Park, Madrid 55.6 El Paseo Shopping Centre, Cadiz 27.3 Arroyo de la Vega Shopping Centre, Madrid 22.4 Owned portfolio Parc Valles Entertainment Centre, Barcelona 62.5 Village Entertainment Park, Athens 59 Source:Pradera Pradera Devonshire House, 146 Bishopsgate, London, EC2M 4JX Tel: 44 20 7539 5432 Fax: 44 20 7504 8425 www.pradera.co.uk