Pramerica Real Estate Investors has formed a joint venture to develop a €120 million mall in Böblingen, near Stuttgart in Germany.
The pair have formed a Luxembourg-based joint venture, PBC Preco S.à.r.l., to finance the acquisition of a site and the subsequent construction of the shopping centre. Pramerica’s investment is being made by the London-based Merchant Banking Group on behalf of institutional investors in its PRECO IV fund.
There is already outline planning consent for around 24,400 square metres of retail space comprising 95 units and more than 800 parking spaces. The JV will acquire the site and plans to begin construction in mid-2012.
Hkm is an 18-strong local company that will advise on the development, administration and management of the centre as well as rent negotiations.
“This JV is very much in line with Pramerica’s strategy of partnering with experienced local operators in markets where we see strong potential to create value,” said Philip Barrett, managing director of Pramerica. “It is clear that there is significant demand for a better retail offer in Böblingen.”
Krämer explained Baden-Württemberg was a very stable “investment environment”. Böblingen as a town also has a “high absolute purchasing power” and is one of the top five development regions in Germany. “As such the potential tenant demand is large,” he added.
Project financing has been provided by EuroHypo.