Echo Polska completes first leg of M1 deal

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Echo Polska completes first leg of M1 deal

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Published Date: 2018-01-05 | Source: Stephen Gunnion | Author: Stephen Gunnion

Echo Polska completes first leg of M1 deal

The acquisition of the M1 retail portfolio will move the property investor closer to its aim of becoming a leading Polish retail landlord

Echo Polska Properties says it has finalised the first tranche of its €692 million acquisition of eight regional shopping centres and four retail parks across Poland. The property investor says all outstanding conditions have been met for the first leg, which will see it acquire four properties for an aggregate value of €358.7 million and an aggregate purchase price of €135 million.

It's funding the deal by issuing new stock and says it listed 88.6 million shares on the Euro MTF market of the Luxembourg Stock Exchange and the JSE's main board yesterday.

Echo Polska is completing the transaction in three tranches to give the seller time to implement various contracted asset management initiatives, including lease renewals and renegotiations, to align the deals with Echo Polska's investment strategy. It expects to wind up the entire transaction over the next two and a half years and says it will double its current retail portfolio gross lettable areas. It says the portfolio has a strong track record and will give it a presence in more established regional cities across Poland.

In November, the group said it had agreed to sell a portfolio of office properties including Triton Business House in Gdansk, A4 Business Park in Katowice and West Gate in Wroclaw for €160 million. The real estate investment trust says the move is part of its strategy to become a purely retail investment platform over the next three to four years.

"The acquisition takes us a significant step closer to becoming one of the leading retail landlords in Poland," CEO Hadley Dean said in a statement. "The deal also provides further scale benefits for our tenants and strengthens relationships with our financial partners."

Echo Polska's shares shed 1.8% yesterday to close at R16.02. They are down 16% from a year ago.



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