BERLIN-WealthCap, a Munich-based subsidiary of UniCredit Bank, has closed the sale of the 1.1-million-square-foot Gropius Passagen mall here for about $446 million. A joint venture of TIAA-CREF and MFI Management was the buyer in the deal, which was first announced in November.
The property, one of the largest retail centers in the city, features 150 stores in the Neukolln district, a strong residential area that is just north of the new Berlin Brandenburg Airport. Anchors at Gropius include Kauflan, Peek & Cloppenburg, H&M, Douglas Group and UCI Cinema.
A spokeswoman for WealthCap said in a statement that the sale price for the property, owned through the KG Germany 11 fund, leads to a return of up to 75% relative to the subscription amount. “The demand for retail properties remains strong, especially in locations with limited supply like Berlin,” she says. “It makes sense from our point of view to perceive the positive market situation.” The fund also owns two mostly full office buildings in the area.
TIAA-CREF said in a statement that it purchased an 80% interest in the Gropius mall in the joint venture. Aymeric Thibord, director of real estate investment for the New York City-based firm, said in a statement that the purchase reflects a strategy to develop a diversified real estate portfolio that includes high-quality, dominant shopping centers in markets benefiting from strong catchment areas.
This is the second retail center owned through a venture of the two companies. TIAA-CREF and MFI developed the 323,000-square-foot Erglangen Arcaden shopping center, with 100 stores. The Effen, Germany-based MFI already manages four shopping centers in Berlin, namely Spandau Arcaden, Schonhauser Allee Arcaden, Wilersdorfer Arcaden and Neukolln Arcaden. The company said in a statement that its corporate strategy is to increase its real estate property value to $2.6 billion by 2016.
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