Rodamco Europe NV, has paid €52m (£35.6m) for 50,800 sq ft of retail units in Velizy 2 shopping centre, western Paris.
Rodamco, the largest publicly listed property investment and management company in the European retail sector, bought the units from Galeries Lafayetts.
The units are leased to H&M, Andaska and Europa Quartz for a gross rent of €2.3m (£1.6m) pa, with an estimated reversionary potential of 25% and a net initial yield of 4%.
This increases Rodamco’s stake in the co-ownership of Velizy 2, one of the largest regional shopping centres in France, from 17.8% to 23.7%.
CEO Maarten Hulshoff said: “This strategic acquisition makes Rodamco Europe the second largest investor in Velizy 2 after Auchan, which also gives us strategic access to a potential extension of the shopping centre.
“Furthermore, there is an estimated reversionary potential of 25%, which gives us the opportunity to increase rents in the future”.
Velizy 2, with a total gross lettable area of 1m sq ft, anchored by an Auchan hypermarket and a Printemps department store, generates €842m (£577m) in annual turnover.
A substantial renovation project is currently in process, with a total budget of €30m (£20.5m) and an estimated completion in 2007.
References: EGi News 12/01/06
