Intu picks partner for Madrid mall
UK shopping centre owner Intu Properties has found a co-investment partner for the Madrid Xanadú shopping centre that it acquired in March.
UK shopping centre owner Intu Properties has found a co-investment partner for the Madrid Xanadú shopping centre that it acquired in March.
The new partner has extensive experience operating shopping centres in the Spanish capital and will assist Intu as it increases its presence in the country. Intu said it would form a joint venture with and will sell half of the mall to TH Real Estate for nearly R4bn.
Having become a major player in the UK, Intu is expanding into Spain, which is experiencing an economic boom. The Spanish economy grew 3.2% in 2016, largely driven by tourism.
Intu and TH Real Estate, on behalf of its pan-European investment vehicle, the European Cities Fund, have agreed to form a joint venture to own the Madrid Xanadú shopping centre. The shopping centre, which opened in 2003, has an annual footfall of 13-million customer visits and an annual net rental income of €23m.
The mall provides about 220 retail, catering and leisure units and includes retailers El Corte Ingles, all of the Inditex fascias, Primark, H&M, Apple and Mango.
Intu CEO David Fischel said the mall also had a strong leisure offering with SnowZone, Spain’s only indoor ski slope, a 15screen Cinesa cinema and Ilusiona bowling. This offering would be enhanced by an aquarium and Nickelodeon indoor theme park, which are under development.
Intu acquired Madrid Xanadú in March, stating at the time that it would look to introduce an investment partner.
TH Real Estate would acquire a 50% interest in the joint venture, which includes the centre and the SnowZone business but excludes the management company, for a price of €264.4m, which is 50% of the price paid by Intu to entities of the Ivanhoé Cambridge Group, before net debt, working capital and other adjustments.
Stanlib listed property funds head Keillen Ndlovu said Spain still offered attractive metrics for real estate investors and was still relatively cheap compared to France and the UK.