Sveafastigheter and HGR divest EUR 154 million portfolio

Sveafastigheter and HGR Property Partners have entered into an agreement to sell a grocery retail property portfolio consisting of 128 properties in Finland with a total lettable space of approx. 130,000 square metres. The deal will close in December and is based on a total underlying property value of EUR 154 million.

Buyer of the portfolio is the pan-European real estate vehicle “European Retail Income Venture II” (ERIV II), advised by AXA Real Estate Investment Managers (AXA REIM)

The portfolio comprises small and medium sized grocery stores with an average area of approx. 1,000 m2 located in 95 municipalities throughout Finland. The main tenants in the portfolio are the market leaders S-Group, Kesko and Tradeka with nearly equal weights. Sveafastigheter and HGR Property Partners acquired the properties in several transactions during 2006 and 2007. The average remaining lease term in the portfolio is approximately seven years.

– Our co-operation with HGR Property Partners has been very successful and we have been able to carry out the business plan we formulated when the properties were purchased faster than originally assumed. A focused approach to letting and restructuring has yielded excellent results and the divested portfolio is now fully let with well-kept properties, says Simon de Château, CEO of Sveafastigheter.

– We are extremely pleased with the outcome of the intensive restructuring work that has been carried out since we acquired the portfolios together with Sveafastigheter. ERIV II is purchasing a clear-cut, income generating portfolio of quality assets in good locations throughout Finland. Our co-operation with Sveafastigheter continues and we are continuously looking for new investment opportunities in Finland, says Patrick Gylling, CEO of HGR Property Partners.