Unibail-Rodamco SE (UL), Europe’s largest publicly traded real estate company, plans to enter the Portuguese shopping-center market by purchasing two malls for about 500 million euros ($650 million), two people with knowledge of the transaction said.
Unibail-Rodamco, based in Paris, agreed to buy Almada Forum and Forum Montijo from a fund controlled by Frankfurt-based Commerzbank AG (CBK), according to the people, who declined to be identified because the information is private. The fund, CG Malls Europe, is registered in Luxembourg.
Guillaume Poitrinal, Unibail-Rodamco’s chief executive officer, has focused on owning large shopping centers, with big-name brands, that dominate their region. The Portuguese malls, in the cities of Almada and Montijo, have combined space of about 75,000 square meters (807,000 square feet.)
Portugal’s economy will start to recover next year after shrinking by 3 percent in 2012, according to the government’s budget plan. Prime Minister Pedro Passos Coelho is cutting spending and increasing taxes to comply with the terms of a 78 billion-euro aid plan from the European Union and the International Monetary Fund.
Unibail-Rodamco is reinvesting the proceeds from disposals of smaller centers or malls with limited scope to boost rents and values. The French company raised 1.3 billion euros from divestments last year.
Unibail-Rodamco declined to comment in an e-mail. Markus Esser, head of communications at Commerz Real, Commerzbank’s property fund manager, also declined to comment.
In October, Unibail-Rodamco bought the Splau mall in Barcelona for 189 million euros. The company said in a presentation that the transaction is part of its strategy to make acquisitions in large cities or regions where it sees “significant rental growth potential.”
Almada and Montijo are linked to Lisbon, Portugal’s capital, by bridges across the Tagus river. Almada Forum has 262 shops spread over two stories and attracts more than 18 million visitors each year. Forum Montijo has 160 stores, 22 restaurants, a supermarket and a six-screen movie theater, according to its website.
Commerzbank plans to sell all three assets owned by CG Malls Europe, in which it owns a majority stake, to shrink the bank’s balance sheet and cut its property-loan book. The company’s Eurohypo AG real-estate lending unit was the main lender for the three properties. CG Malls Europe will divest the third one, the 36,500 square-meter Espacio shopping center in the Spanish city of Leon, to ECE Projektmanagement GmbH & Co. KG, the people said.
Commerzbank declined to comment, as did Christian Stamerjohanns, a spokesman for Hamburg-based ECE, the shopping center development and management company controlled by Germany’s Otto family.
The owners of the remaining minority stakes in CG Malls Europe are two Dutch pension funds and an unidentified U.K.- based investor.