“GTC and the international private investor have decided to cancel the sale transaction regarding three small-size shopping centers in Romania. The transaction was cancelled due to the fact that an agreement on final conditions could not be reached. GTC is reviewing its alternatives,” GTC said in a statement Thursday.
In November 2012, GTC said it would sell the three malls to a private investor for an estimated EUR6-7 million. It also said the decision to sell the three malls located in Piatra Neamt, Suceava and Buzau, respectively, was due to falling sales over the past years.
“GTC put these properties up for sale and decided to focus only on large scale shopping centers due to the change in market conditions, relatively high operational costs for smaller assets, and their different tenant mix, which lack synergies with the larger retail assets of the Group,” the developer added.
“Each of the three centers comprises between 10,000 and 14,000 sq m of net rentable area. They are located in Buzau, Piatra Neamt and Suceava, which are second-tier and third-tier cities in Romania,” GTC also said Thursday.
GTC representatives previously said total investments in the three malls amounted to EUR65 million. They also said the funds needed to develop the malls were provided by the European Bank for Reconstruction and Development and by Raiffeisen and rose to nearly EUR30 million.
The first mall under the Galleria brand was opened in Buzau in September 2008. In the spring of 2009, it was inaugurated the Galleria mall in Suceava, following an investment of EUR25 million. The Galleria mall in Piatra Neamt was opened at the beginning of September 2009, following an investment of EUR20 million and the fourth Galleria mall was opened in Arad in 2011.
The four shopping malls in Romania were evaluated at EUR84 million at the end of 2011 and their value decreased by EUR12 million to EUR72 million in the first six months of 2012. The four malls stretch onto a total surface of 69,000 square meters and have an occupancy rate of 89%.