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Atterbury invests €200m to expand European footprint

Atterbury invests €200m to expand European footprint

Photo by Atterbury

30th July 2015

By: Megan van Wyngaardt

Creamer Media Contributing Editor Online

  

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South African property developer Atterbury has widened its European footprint, by investing in a €200-million retail portfolio in Cyprus, which comprised two key retail assets on the island nation.

The 27 000 m2 Mall of Cyprus, which formed part of the landmark 55 600 m2 Shacolas Emporium Park, in the island’s capital and largest city Nicosia, as well as The Mall of Engomi, would be developed in collaboration with property capital growth fund Attacq.

The properties were acquired from Cyprus’s largest retail operator NK Shacolas Group, which planned to use the funds to develop a luxury golf and holiday home project – the Limni Resort.

Speaking at a media briefing on Thursday, Atterbury CEO Louis van der Watt said Cyprus represented a good opportunity for growth as the island performed ahead of expectations at each review date, with interest rates dropping by 1%.

He added that there was renewed optimism on a political solution to reunite the Turkish northern and Greek southern parts of the island, thereby creating additional investment opportunities.

Van der Watt further highlighted that it was also a market that remained untapped by other international property development businesses.

Speaking to Engineering News Online, he said the cultural differences and language barriers that often deterred other property development companies from investing in foreign countries were opportunities for Atterbury, as first-mover advantage applied. “Whoever is prepared to cross that barrier is the one that’s going to make the money,” he explained.

Meanwhile, Van der Watt added that, unlike Greece, Cyprus had already completed austerity measures and taken a haircut to repay its debt. Its economy was now growing and Atterbury Europe was able to make strategic investments at the bottom of the market, resulting in an excellent opportunity for upside benefit.

Further, the company would, through the establishment of an office in Vienna, Austria – which would be run by Atterbury Eastern Europe Services MD Raoul de Villiers – continue to focus on growth opportunities on the continent, particularly Eastern Europe.

The group believed that, owing to Eastern Europe’s communist history, well-educated and skilled population, with high levels of employment across many industries, and mostly nonmortgaged home ownership, many consumers had higher disposable income.

However, the supply of retail and retail centres was low compared with Western European standards.

Moreover, many multinational retail brands had also identified the demand for more retail in the region and targeted the fast-growing Eastern European market as a growth opportunity.

“Yet, they are faced with a scarcity of shopping centre space, making it difficult for them to enter this market. As a result, there are numerous opportunities for retail property development in the region,” the group said in a statement.

RETAIL DEVELOPMENTS
The Mall of Cyprus hosted a 20 000 m2 standalone Ikea store and other freestanding retailers, including Carrefour, Zara, Debenhams, Intersport, McDonald’s, Starbucks and many top multinational retailers. It attracted over five-million visitors a year.

Atterbury was now in talks to expand the mall to further meet retailer and customer demand, with NK Shacolas Group subsidiary Woolworth Properties still owning a plot of 10 890 m2 next to the mall, worth €9-milllion, for which Atterbury would have the first right of refusal over the next two years.

The Mall of Engomi, meanwhile, was located in a densely populated residential area with expansion and revitalisation potential. It had around 18 000 m2 of gross lettable area and tenants included Debenhams department store, Carrefour Hypermarket, Superhome Centre and various fashion outlets.

With over 1.5-million visitors each year, an expansion was planned in the near future.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

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