At a glance
- GIC holds 80% of the partnership and FREY the remaining 20%, with FREY as operating partner.
- An allocator comparing the partnership with an open-end retail fund gets a named seed portfolio and an operator that keeps a 20% interest in the assets it manages.
- The mandate covers existing retail parks of 5,000 to 35,000 square meters (53,820 to 376,737 square feet) in Western Europe and Poland.
Singapore sovereign wealth fund GIC and French real estate company FREY formed a €400 million ($442 million) equity partnership to invest in retail parks across Europe, IREI reported.
GIC holds 80% of the partnership and FREY the remaining 20%, with FREY as operating partner. FREY is seeding the partnership with three parks valued at about €176 million ($195 million): Woodshop in Cesson, France; Parque Mediterráneo in Cartagena, Spain; and Algarve Retail Park in Albufeira, Portugal.
An allocator comparing the partnership with an open-end retail fund gets a named seed portfolio and an operator that keeps a 20% interest in the assets it manages. The structure leaves allocators to assess whether FREY will keep co-investing 20% in future parks.
The mandate covers existing retail parks of 5,000 to 35,000 square meters (53,820 to 376,737 square feet) in Western Europe and Poland. It targets standing assets rather than development.
FREY said the partnership will expand its European retail portfolio while third-party capital finances acquisitions. It said it will keep pursuing investments outside the partnership through its existing strategies and balance sheet, and expects the venture to contribute positively to earnings per share and net asset value. "Premium retail parks remain attractively priced and should continue to deliver strong organic growth," said Antoine Frey, the company's chairman and chief executive.
The three seeded parks account for 44% of the €400 million commitment, leaving about €224 million of equity for further purchases if the full amount is drawn.
Premium retail parks remain attractively priced and should continue to deliver strong organic growthAntoine Frey, chairman and CEO of FREY
Reported by the Fundraising desk from IREI. Published . Corrections