The acquisition was carried out in the name of the European Co-Investment Fund (ECF), the European added value fund of CBRE Global Investors. It was subject to the fulfilment of a series of conditions, estimated to be achieved by the end of June, after which the acquisition will be complete. The investment has been structured as a joint venture, or investment jointly with the actual owner of the centre, Alpha Real Trust Limited, which will keep a 30% capital share. Therefore, the present management, Alpha Real Capital LLP (manager of investments and main shareholder at Alpha Real Trust Limited) will continue as the operative partner.
This acquisition is the seventh investment by the ECF fund, which, with this transaction now holds the entirety of its committed capital. The ECF fund reached the final closure of capital in February 2016, levying approximately 840 million dollars fro a group of North American and European investors. It is closed capital fund which invests in added value property assets all over Europe, with the aim of constructing or repositioning assets in the retail and logistics sectors, and to create core products in a limited offer setting.
The H2O shopping centre is at Rivas Vaciamadrid, one of the fastest growing areas of Madrid located 17 km to the south east of the city centre. Inaugurated in 2007, the shopping centre has an area of 52,000 square metres, comprising 130 shops spread over two floors around an artificial lake and a large green zone. The centre is focussed on leisure and eating facilities. Among the main tenants are Nike, Mercadona, H&M, Mango and seven brands of the Inditex group, including Zara, Bershka and Massimo Dutti, together with leading cinema operator, Yelmo.
As a consequence of the acquisition of control on the part of the new member, H2O will be renovated to reinforce the available entertainment facilities, to improve the tenant mix, and to consolidate further the centre. The recent acquisition of additional land also gives an additional expansion opportunity.
Charles Baigler, Manager of the ECF fund, has stated that, “This is ECF’s seventh investment and, with this, the fund’s investment capacity is now totally compromised. This transaction is in line with our strategy to acquire leading assets with opportunities for renovation and development, in limited offer markets. We are delighted to count on the present manager, Alpha Real Capital, to carry out the business plan allowing us to take advantage of the predicted growth in rents in the Madrid retail market and create a core, stable shopping centre.”
Brad Bauman, co-manager of the Alpha Real Trust Fund Limited, added, ”We are most pleased to be associated with CBRE Global Investors and to continue our investment in the H2O shopping centre. We believe that the centre will continue to offer high returns for our shareholders.”
Retail Partners Europe and Jones Day acted as consultants for CBRE Global Investors.