News

EPP acquires €91.1mn King Cross Marcelin Shopping Centre

Hadley Dean, Echo Polska
Hadley Dean, CEO of Echo Polska Properties.

EPP has announced the acquisition of the King Cross Marcelin Shopping centre for  €91.1 million. This marks the group’s first entry into Poznan, adding to the group’s portfolio of eighteen retail projects which lines up with its strategy of becoming the dominant owner of retail properties in Poland’s best markets.

The property is being purchased through its wholly-owned Polish subsidiary, EPP Development 7 SP.z.o.o from Poznań onkil S.A.  which holds its legal title to the property. The initial yield of the acquisition of 7.30% is favourable compared to the current sub-7% yields in other Polish cities.

EPP CEO, Hadley Dean commented:

“We’ve been eyeing this deal for some time, and with our share price where it is, it makes sense from every angle. It fits perfectly with our portfolio as it has strong KPIs, good asset management opportunities and will provide great value for our shareholders … We are confident this will strengthen our portfolio of properties in Poland’s most lucrative markets, and more importantly will deliver a fantastic value to all our shareholders.”

As with all of EPP’s centres, Marcelin is dominant in its catchment area – Poznan has one of the strongest local economies in Poland, with unemployment and strong GDP growth. The city is the third most administrative area in Poland with a population of 540 400, whilst the larger Poznań Metropolitan Area is home to nearly 833 000 people. Directly adjacent to the property, the Business Garden Poznan 135 000mbusiness park is currently under construction which will attract an additional 12 000 people daily to the catchment area.

As with all EPP centres Marcelin is dominant in its catchment area. Poznan has one of the strongest local economies in Poland with low unemployment and strong GDP growth. The city is the third most populous voivodeship (administrative area) in Poland with a population of 540 400, while the larger Poznań Metropolitan Area is home to nearly 833 000 people. Directly adjacent to the property, the Business Garden Poznan 135 000mbusiness park is currently under construction which will attract an additional 12 000 people daily to the catchment area.

The 45 353m² centre is already 99% let to popular international and national retailers including Media Markt, H&M, Intersport, CCC and McDonald’s.

“This follows on the €334 million worth of acquisitions concluded at year-end (December 2017) and the €692 million acquisition of the M1 portfolio announced in December 2017. “By 2020 EPP will own 27 shopping malls with almost 1 million square metres of GLA across Poland, which aligns with our aim of becoming a leading retail landlord in Poland,” says Dean.

The transaction is subject to certain pre-closing covenants.