AEW Europe and Tristan Capital Partners have completed a sale and leaseback deal with Spanish retail giant Eroski in a deal valued at €150 million.
The investment, in more than 10 retail units across the country, was completed on behalf of their jointly managed European Property Investors Special Opportunities (EPISO) fund. The assets total approximately 120,000 square metres and are 100 percent occupied with an average weighted unexpired lease length of 20 years.
Ric Lewis, cheif executive officer of Tristan Capital Partners, described the investment as “durable” and the grocery-anchored retail property market, a “defensive sector”. He said: “We believe this long-leased investment into a durable and defensive sector like grocery-anchored retail property will prove to be a thoughtful and counter-cyclical means of investing the EPISO fund into the recovering Spanish economy.”
Spain’s economy is one of the last in Europe to pull out of a recession having suffered significantly from a housing bubble and from taking on too much debt. It was still shrinking in the fourth quarter last year, although at a slower rate than before, according to a recent report by the Financial Times. Quoting figures from the National Statistics Institute, the newspaper reported that Spain had suffered seven successive quarterly declines in gross domestic product, culminating in a 3.6 percent decline for 2009. However, the FT also reported that Moody’s, the credit rating agency, had praised the Spanish government’s “clear determination” to restrain state spending through a plan which outlined €50 billion of budget savings by 2013.
Rob Reiskin, head of investments at AEW Europe, said: “In disrupted markets, there are excellent deals available for those experienced investors able to differentiate between short-term impairment and long-term intrinsic value. We believe this transaction demonstrates this fact.”