NEPI has taken over the majority stakes in ModaTim Investment SA (MTI) and ModaTim Properties SA (MTP), the developers of City Business Centre in Timisoara. Ovidiu Sandor, who started the Timisoara investment, will continue to manage the whole project until 2015 and he will coordinate the development of two additional buildings in the office park, the property fund said in a statement.
The aggregate purchase price for the shares in and shareholders’ claims against MTI and MTP is an amount of approximately EUR16.55 million, which will be funded through the proceeds of a vendor consideration placing in terms of which 5,518,057 new ordinary NEPI shares will be issued and placed at EUR3.00 per share, NEPI said.
NEPI also assumed external bank debt of EUR29.29 million. The project was valued at EUR45.64 million, the fund also said.
Upon completion, City Business Centre will span over 43,000 square meters (gross leasable area) and will include five interlinked structures. The three existing buildings, with a lettable area of 25.000 sqm, are currently 90% leased to large international tenants such as IBM, PricewaterhouseCoopers, Vodafone, Alcatel-Lucent, Wipro Technologies, BCR, Deloitte and Microsoft.
“The construction works for the fourth building are underway and are due for delivery in the summer of 2012, while the fifth building is due for delivery by the end of 2013, both buildings already benefiting from solid and increasing occupier interest,” the vendor’s sale adviser Jones Lang LaSalle said in a release.
City Business Centre is the largest A-class office park outside Bucharest.
“Due to its volume and location (outside Bucharest), the transaction represents a record for the Romanian investment market: no other business centre of such volume was ever transacted on the office market in other major cities except Bucharest,” the release adds.
The investment for the office park was estimated at some EUR50 million, or EUR10 million for each building.
Besides Jones Lang LaSalle, the vendors were also assisted by law firm NNDKP and financial and audit firm PricewaterhouseCoopers.
NEPI is the first realty investment fund listed on the Bucharest bourse, in a market segment created especially for Real Estate Investment Trusts (REITs). The fund is also listed in Johannesburg (South Africa) and London, on the AIM segment.
The NEPI portfolio includes retail, office and industrial property in Romania and Germany. In Romania, the fund’s main assets are the European Retail Park unit in Braila and the Floreasca Business Park office building in Bucharest.