Union Investment sells palladium shopping centre in Prague

Profitable sale for UniImmo: Germany

Union Investment has profitably sold the palladium in Prague acquired in 2015 for UniImmo: Deutschland. The buyer is the largest fund of the Czech REICO Erste Asset Management. The Hamburg-based real estate investment manager thus completed the largest real estate transaction ever carried out on the Czech market. At the same time, the sale marks the largest single-asset transaction in the retail sector carried out in the CEE region this year. The sales price achieved is higher than the last appraisal value of the property and significantly higher than the purchase price paid by Union Investment in 2015.

“Palladium is a success story for UniImmo: Germany, from the purchase to the successful exit. The timing of the sale at the beginning of the new market cycle is perfect. Over a period of ten years, the property has generated a positive cash flow and a high level of earnings stability, as well as achieving high increases in value,” says Laura Roll, Senior Investment Manager Retail at Union Investment.

“We have successfully exploited the returning interest in dominant and high-quality retail properties in Europe to achieve a record sales price, which we will use to further develop the fund’s portfolio through targeted reinvestments in European gateway cities,” says Henri Eisenkopf, Director Transaction Shopping Places at Union Investment. In line with the fund strategy, investments in retail properties, hotels, logistics and office properties are examined in particular.

Palladium comprises a total usable area of around 60,000^m2, of which around 17,500^m2 is office space. The property includes over 800 car parking spaces in an inner-city parking garage. The 180 shops are predominantly occupied by strong local and international brands, including numerous flagship stores. Thanks to its easy accessibility in a central location on Republic Square between Prague’s Old Town and Prague New Town, the iconic center attracts over 14.8 million visitors per year.

Union Investment was advised on the transaction by CBRE, Clifford Chance and TPA. The buyer was advised by Willsons, ASB, Savills and Cushman and Wakefield.