Saturday 24 March 2018

Greenman adds to German portfolio with €20m deal

Greenman Investments is buying the Kamen Quadrat in Germany
Greenman Investments is buying the Kamen Quadrat in Germany
Peter Flanagan

Peter Flanagan

An Irish property firm has forked out more than €20m to buy a regional shopping centre in Germany.

Greenman Investments said it had agreed terms to take control of the centre in the town of Kamen.

Terms of the deal were not released, but industry experts believe the property would have fetched between 20m and €25m.

The all share transaction sees Greenman take control of the Kamen Quadrat. The town of Kamen is in North Rhine Westphalia close to Dortmund.

The Kamen Quadrat is a "hybrid centre" opened last year. The property features a rental space of 7,730 square metres. Grocery giant REWE, the main tenant of "Kamen Quadrat", has a share of 37pc of the total rental space. Netto - a Danish retailer - is the second largest tenant with around 18pc. Drug store chain Rossmann, sportswear group Deichmann and six other tenants occupy the remaining space.

According to Greenman, "hybrid centres" range in size between specialist retail parks and larger retail centres. They are typically anchored by a large food retailer and cover the entire range of food, and non-food needs.

"Centrally located in small and medium-sized towns, they cater for demand from the surrounding areas not served by large shopping centres," Greenman said.

Company chief executive John Wilkinson said the property "fits very well in the portfolio of our fund "Greenman Retail+".

"The anchor tenant, REWE, has signed a contract for 20 years, and the other contracts have terms of 10 to 15 years.

"This makes the centre an extremely attractive investment in our view. The mix of tenants as well as the exceptional location in the pedestrian zone in Kamen's city centre convinced us to buy this property. Kamen also offers the right framework conditions for retail. Its retail centrality is way above the German average," he said.

This is the third major deal to involve Greenman and its Retail+ fund. It bought another hybrid centre at Datteln near Dortmund for €26.4m last November. It owns another at Stralsund on Germany's Baltic coast.

Greenman, which is backed by Irish investors, is focused entirely on the German retail market.

The German retail market is seen as one of the more stable commercial property classes available at present.

In 2014 Greenman became the first Irish-owned investment manager to be approved by the Central Bank of Ireland as an Alternative Investment Fund Managers. The firm is, which is Irish based but also has offices in Luxembourg and Germany, aims to provide Irish investors with an opportunity to invest in real estate funds which own large German food retailing stores and neighbourhood shopping centres.

Last April it paid €95m to take over 29 grocery stores from Edeka, Germany's largest grocer.

The company, which has close to €300m worth of assets under management at present, is aiming to increase that to over 500m by this summer.

Indo Business

Business Newsletter

Read the leading stories from the world of Business.

Also in Business