New Europe Property Investments PLC, the Central and Eastern European property investment company listed on AIM, announces a further investment for a total consideration of €16.9 million, net of acquisition costs and including €14.9 million of debt (of which approximately €0.9 million is vendor finance).
The Company has concluded an agreement to acquire 50% of a portfolio comprising four retail centres, a medical office facility and a mixed use retail and residential property (the “Portfolio”).
The retail centres are situated in Leipzig, Bruckmuehl, Eilenberg and Frankfurt (all in Germany). The shopping centre in Leipzig has a total site area of 12,712 sq m with a total lettable area of 5,864 sq m with 300 parking bays. The Bruckmuehl property has a total site area of 15,941 sq m and the building has a total lettable area of 5,899 sq m with 200 parking bays. The Eilenberg property has a total site area of 15,000 sq m and the building has a total lettable area of 3,727 sq m with 200 parking bays. The Frankfurt property has a total site area of 1,652 sq m and lettable area of 1,093 sq m. The medical centre is located in Munich in Germany – the six storey building has a total site area of 491 sq m with a total lettable area of 2,360 sq m. The mixed retail and residential property is located in Moelln and has a site area of 10,111 sq m, a lettable area of 5,510 sq m and 150 parking bays.
The vendor has agreed to provide an interest free loan by deferring payment of €1.7 million of the purchase price for 100% of the Portfolio (ie approximately €0.9 million of the price payable by the Company) for a period of five years. The balance of the price payable by the Company will be paid to the vendor in cash, funded in part by a seven year loan of €14 million from Nord LB, with the remainder of the consideration being paid from the Company’s existing cash resources. The total net annual rent for the Portfolio is expected to be approximately €2.4 million (the Company’s share therefore being €1.2 million), representing a yield on purchase price of approximately 7.22%.