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TH Real Estate's European Cities Fund completes first acquisition

TH Real Estate has acquired Meraville Retail Park in Bologna, Italy, on behalf of its European Cities Fund for a net initial yield of circa 6%. Acquired from Orion IV European 4 S.à.r.l. (a subsidiary of Orion European Real Estate Fund IV), this is the first acquisition for the Fund, which was launched on 1 March 2016 as a pan-European open-ended real estate investment vehicle with €200m of equity.

Located in Bologna, the capital of Emilia Romagna and Italy’s second wealthiest city, Meraville Retail Park benefits from a 30-minute drive time catchment of nearly 800,000 people. In a rating of 1,200 European regions by TH Real Estate’s research team on factors such as employment growth, employment structure, unemployment, population growth and GDP per capita, Bologna rated in the top 12%.

The retail park adds to TH Real Estate’s strong presence across Italy, where its current portfolio of 11 assets totals c.€1.3bn AUM.

Mario Pellò, Head of Investment, Italy, TH Real Estate, adds: "With its high occupancy rate, strong sales performance and location in Italy’s second wealthiest city, Meraville Retail Park perfectly meets our investment requirements for the European Cities Fund. We believe that the retail warehouse market will be a sector where we will continue to see yield advantage and that Meraville specifically presents strong asset management opportunities.

Liz Sworn, Fund Manager, Europe, TH Real Estate, comments: Measured against other European cities, Bologna continues to outperform in areas such as employment, growth and GDP per capita. In addition, retail sales growth in the city is predicted to average 1.4% per annum in the next five years, outperforming the Italian average. We strongly believe in the investment fundamentals of Bologna and feel that Meraville Retail Park will prove to be a strong asset for the Fund. 

Issued by Henderson Real Estate Asset Management Limited, 201 Bishopsgate, EC2M 3BN. Authorised and regulated by the Financial Conduct Authority. TH Real Estate is a name under which Henderson Real Estate Asset Management Limited provides investment products and services. The value of investments and any income will fluctuate (this may be partly be the result of exchange rate fluctuation) and investors may not get back the full amount invested. Where opinions have been expressed, they are based on current market conditions and are subject to change without notice.

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