TH Real Estate buys 50% of Madrid mall for €264m

The London-based investment manager owned by TIAA, has used capital from its European Cities Fund (ECF) to acquire half of the Xanadú Shopping Centre from FTSE 100-listed mall specialist Intu Properties. 

TH Real Estate, the London-based investment manager owned by financial services giant TIAA, has acquired a 50 percent stake in Madrid’s Xanadú Shopping Centre, one of the largest malls in Spain.

The investment manager has formed a 50:50 joint venture with FTSE 100-listed Intu Properties, the London-based shopping center specialist, which owns the the asset.

Intu Properties bought the shopping center in March this year from Ivanhoe Cambridge for €530 million, stating at the time that it was looking to introduce an investment partner.

TH Real Estate said it used capital from its European Cities Fund (ECF), launched last year, to acquire the shopping center. A spokesman for the firm said Xanadu Shopping Centre chimed with its strategy of targeting well-positioned assets with potential for long-term growth in “future proof” cities across Europe.

Totaling around 1.2 million square feet, Xanadú is located south-west of Madrid. Key tenants include Decathlon, Primark, H&M and Apple. The mall also boasts southern Europe’s only indoor ski slope, as well as a cinema, bowling alley and 8,000 parking spaces.

“Xanadú is a super prime shopping center with a first-rate tenant line up and extensive asset management potential,” said Andrew Rich, ECF fund manager. “Future plans to further enhance the leisure element of the scheme cement its position as an asset that is well-positioned to deliver a robust income return,” Rich added.

“Madrid is one of the future-proof cities identified by our research team, thanks to its strong GDP growth and a GDP per capita that is higher than the national average. Located just 20 kilometers from Madrid’s city center, with over four million consumers located within a 30-minute drive of the center, Xanadú benefits from these demographic fundamentals and we believe in its long-term ability to deliver returns for our investors,” said Marta Cladera de Codina, head of Iberia at TH Real Estate.

TH Real Estate’s acquisition is its fourth on behalf of the ECF, following investments in Meraville Retail Park, in Bologna; the Omni Centre, in Edinburgh; and the Kamppi Centre, in Helsinki.

The firm held a first close on behalf of the fund in July last year after collecting around €500 million towards a target of between €3 billion and €5 billion.