July 21, 2005
Citycon expands to Estonia, acquiring Tallinn's Rocca al Mare Shopping Centre
Citycon Oyj specialising in retail premises, has today acquired the Rocca al Mare Shopping Centre in Tallinn, the capital of Estonia. Citycon also acquired the neighbouring land with city planning for future extension. The right of possession was transferred to Citycon at the date of acquisition. The total debt-free purchase price was EUR 62.1 million and the net yield of the existing shopping centre at the date of the transaction was 8.5 per cent excluding the additional land. This acquisition opens the Baltic market to Citycon and contributes to the company's expansion strategy in Scandinavia and the Baltic countries.
"Citycon acquired its first shopping centre in the Baltic area and will start to build its extension of 25.000 sq.m. as soon as all permits have been obtained and subject to successful marketing of the retail premises. Citycon has now implemented its growth strategy by investing in prominent shopping centres in Sweden and Estonia. We are actively looking for possibilities to continue our growth both in these areas and in Finland", says Citycon's CEO Petri Olkinuora.
Rocca al Mare's occupancy rate is close to 100 per cent. The shopping centre's anchor tenants are the Finnish retail chains Prisma and Hobby Hall. The estimated total sales volume of the shopping centre for 2004 was EUR 37.0 million, with roughly 4.5 million customers visiting annually.
The aim of the potential extension project is to improve the property's competitiveness and ensure its solid commercial position in the future. The permitted building volume of the land acquired for the extension is 25,000 sq.m. Citycon expects to start the extension project already this year provided that all necessary approvals will be obtained. The extension is scheduled for completion within three years. Estimated investment of the extension project will be approximately EUR 20 million. Once the extension is complete, the annual net yield of the shopping centre is expected to exceed the present net yield.
Citycon will initially finance the acquisition through a bank loan arranged by Nordea Bank Finland Plc.
Citycon is Finland's market leader in the shopping centre business, owning a total of 16 shopping centres in the Helsinki Metropolitan Area and other regional centres in Finland, as well as the Åkersberga shopping centre in Sweden as of 1 July 2005.
In addition to the shopping centres, Citycon owns 127 supermarket and shop properties in Finland. The market value of Citycon's property portfolio was approximately EUR 754.7 million on 30 June 2005, of which shopping centres accounted for 60.9 per cent and supermarkets and shops for 39.1 per cent.
For further information:
CEO Petri Olkinuora, tel. +358 9 6803 6738 or
(mobile) +358 400 333256
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