ATTERBURY EUROPE, MPC JOIN FORCES
Johannesburg – Atterbury Europe has acquired a one-third stake in a e259 million (R4 billion) gross asset value portfolio of seven Serbian shopping centres with MPC Properties.
The ambition of property developer Atterbury Property Holdings (Atterbury) to grow its offshore exposure is starting to bear fruit, as it unveiled its investment plans into Cyprus.
Atterbury, through its newly-launched Netherlands incorporated company Atterbury Europe; will see it invest in eastern Europe retail centres.
Its expansion into the market will be a joint venture between the counter, JSE-listed capital growth property fund Attacq Limited (Attacq) and several undisclosed European investors.
Although Atterbury currently has a partnership with MAS Real Estate whereby it is developing a 70 000 square metre mixed-use development in Edinburgh, Scotland – more investments in Europe are piquing its interest.
Atterbury has already hit the ground running, as it acquired two shopping centres with a combined value of €200 million (R2.8 billion).
CEO and founder of Atterbury Louis van der Watt says after the company rolled out retail developments on the African continent, largely Mauritius, Namibia and Ghana, it was time for the new growth avenues.
“In the last two years we looked at eastern Europe. Some of the overseas developers had moved into the region. But we found a couple of countries that we like,” Van der Watt says.
The search pointed to Cyprus. It acquired the 18 000 square metre Mall of Engomi in Nicosia, the capital of Cyprus; and the 55 000 square metre Shacolas Emporium Park, also in the area. Atterbury Europe is planning to expand both malls.
The tenants of the respective retail centres already include Zara, Starbucks, Debenhams among other retailers. Attacq which was listed on the JSE by Atterbury , owns a 48.7% stake in the two shopping centres.
Atterbury Europe will hold the remaining share.
Van der Watt says because there are not a lot of property players in Cyprus and that the country’s infrastructure is well developed makes for a strong investment case.
“Also Cyprus is easy to handle, as it’s not a big country and economy” he says.
On retail fundamentals, Cyprus is offering leases of up to 15 years which secures property companies long-term rental income.
While a lot of retail amenities in Cyprus are largely in a high street format, Van der Watt says there is no mall culture. But because large retail tenants are demanding bigger space beyond what high street shopping space can accommodate, malls are becoming in vogue.
It has identified three more opportunities and in Limassol Atterbury Europe plans to build another mall. “Also in Serbia we are looking at a portfolio we want to buy there. Before the end of the year there will be some substantial transactions in Atterbury Europe,” he explains.
Attacq will also be part of future developments. Raoul de Villiers has been appointed as the managing director of Atterbury Europe Properrty Services.
Local companies look into Europe
Over the last few years, local listed property companies have been bullish on the European market including Stenprop Limited, Rebosis Property Fund through New Frontier Properties, New Europe Property Investments and recently Tower Property Fund.
Van der Watt expects more funds to bulk up their eastern Europe exposure in the next two years. The market seems to have welcomed Atterbury and largely Attacq’s move.
As listed property manager for Old Mutual Investment Group’s MacroSolutions boutique Evan Robins puts it: “They [Attacq] had made known an intention to increase offshore exposure. They have a substantial stake in JSE listed offshore property company MAS Real Estate so it is interesting that they are making this independently of MAS Real Estate.
“It is also interesting that they are investing in Cyprus which is peripheral Europe,” Robins says.