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NEPI buys €235m Zagreb shopping center in record deal

South African property investor New Europe Property Investors (NEPI) has acquired Croatia’s largest shopping center from a JV between Chicago-based investment manager Heitman and Budapest-based property firm Granit Holdings. 

A shopping center in Zagreb, Croatia has been bought by South African property investor New Europe Property Investors (NEPI) for €235 million, making it one of the largest single asset transactions in South Eastern Europe (SEE).

The Arena Centar, located in the Croatian capital, was acquired from a joint venture between Chicago-based investment manager Heitman, on behalf of its value-add fund, Heitman European Property Partners IV, and Budapest-based property firm Granit Holdings.

The asset, built in 2010, is considered the country’s dominant retail and entertainment hub and offers a total of 598,000 square feet with current tenants including Interspar, P&C, H&M and Intidex among the 215 retail units.

NEPI was unavailable for comment, but, according to the firm’s website the deal was completed in mid-December.

According to JLL, which advised Johannesburg-based NEPI throughout the transaction, the asset received a high level of interest from a number of institutional investors, from Europe and beyond.

Uros Grujic, head of capital markets, SEE at JLL, said: “This proves that the SEE region is becoming a new investment destination thanks to good quality assets, combined with attractive yields across emerging economies like Slovenia, Croatia and Serbia. With debt terms becoming more attractive by the quarter, we expect to see new capital come into the region which will be targeting not only the retail segment but also other proven asset classes across South East Europe”.

JLL also confirmed that the Arena Centar is the last of the SEE region’s six largest shopping centers to be sold in the last 18 months.

NEPI was formed in 2010 and since then the property investor has acquired a range of retail assets in emerging SEE markets such as Serbia, Romania, Slovakia and the Czech Republic. Recently it has also started buying offices in Romania.