Wednesday, April 28, 2010

Eroski Closes EUR 150 Million Sale Leaseback of 12 Supermarkets Across Spain

Expansión (as translated by Google) - April 29, 2010

The Eroski supermarket chain has closed its third real estate sales transaction in just four months. The latter was closed this Tuesday. The agreement provides for the sale and subsequent rental (market operation known as a sale & lease back) of more than a dozen establishments in the background episodes.

The transaction, advised by property consultant Cushman & Wakefield, has been closed for 150 million euros. The facilities have a combined total area of 120,000 square meters and are spread throughout Spain, including the hypermarket of the Bañeza (Leon), Azuqueca (Guadalajara) and Luz de Castilla (Segovia).

The average length of contracts signed by Eroski is situated in 20 years.
With this operation, Epis (acronym of European Property Investors Special Opportunities) enters the Spanish real estate market. In 2008, the fund reached 788 million euros for institutional investors, to date, purchases of assets in the UK and France.

The vehicle is real estate fund managed by AEW Capital Partners Europe and Tristan. "We are delighted to have closed this transaction with a major corporation and we believe that due to its strong defensive position in a sector such as the power, this transaction is the ideal investment vehicle to make your diving episodes in a market as in Spanish, "says Ric Lewis, CEO of Tristan Capital Partners.

In accordance with episodes, the supermarket chain that closes the third operation is the sale and subsequent rental of their facilities. The first one took place in late December when the investment firm WP Carey purchased a large block of businesses. In that case, Eroski has not provided or the total number of businesses sold or the total amount of the transaction. In the second transaction, closed on 16 February, the chain received 75 million euros for a portfolio of properties transferred to the same non-listed company (REIT) fund of WP Carey. The sale and subsequent lease was closed at 7% return (yield).

Eroski operates throughout the Spanish territory with a hundred hypermarkets, 1,700 supermarkets and franchises. The group also owns shopping centers, in addition to managing gas stations and travel agencies.

This is not the first time the distribution group uses the divestment of property assets to achieve liquidity. Specifically, since 2001, Eroski has conducted an intense policy of sale of real estate (both supermarkets and hypermarkets, such as schools), keeping their premises as a tenant.

Thus, the company transferred several of its local financial institutions ING and Eurohypo, in addition to selling tracks logistics platforms in Zaragoza and Malaga. In both cases, Eroski opted for the formula for sale and rent back.

Thus, Eroski joins the group of companies and financial institutions that use the formula for sale & lease back to obtain liquidity through the sale of assets, but without losing their respective locations. Among them, BBVA, Banco Sabadell and Barclays. Sphere: Related Content

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