Rockspring Property Investment Managers has completed the refurbishment of its 42,000 square metre shopping centre in Leipzig, the Löwen Center, and the 2,000 sq m extension of its 36,000 sq m Ostkreuz Center retail warehouse park in Hamburg.
This represents the successful conclusion of these major asset management initiatives at the properties, generating significant improvements in value.
Rockspring purchased the 20 year old Löwen Center on behalf of its TransEuropean Property Partnership V in October 2012. Although fully occupied at the time of purchase, it had an average unexpired lease term of under a year due to an expiring head-lease to Metro Properties. Since the acquisition, Rockspring has signed new 15 year leases with the three anchor tenants – Real, Roller and Obi – for a total of 32,500 sq m of retail space. Additionally, new leases have been signed with Expert Electronics, Rossmann drugstore and a number of other specialist retailers.
Following the re-gearing of the leases and the new lettings, the property is 100 per cent let and has an average unexpired term in excess of 13 years. The Löwen Center, located on the west side of Leipzig, has also benefited from a thorough, EUR4m refurbishment, including upgrading the mall facades, signage and shop fronts.
Daniel Rubinstein, head of asset management for Rockspring in Germany says: “The 20 year old property had been under-managed over the years and was in need of a sensitive refurbishment to support the tenants and attract new fresh brands to the Löwen Center. This has been achieved on time and in budget for the recent re-launch prior to Christmas trading.”
The 36,000 sq m Ostkreuz Center is located to the east of Hamburg at the junction of the A1 and A24 motorways. It was originally built over 35 years ago and was refurbished by Rockspring on behalf of its TransEuropean Property Partnership IV in 2012. Following the EUR20m refurbishment, the centre was successfully re-launched with anchor tenants Real, Media Markt and Sconto. Rockspring has now signed a new 15 year lease with Sconto on its 12,000 sq m furniture store, including an upgrade and extension of the space by a further 1,850 sq m at a total cost of EUR3m. Completion of this second phase of the repositioning of the Ostkreuz Center is due for Q1 2014.
Stuart Reid, partner of Rockspring with responsibility for Germany, says: “The successful delivery of the Löwen Center, following hard on the heels of Ostkreuz Center, Hamburg, and the Iller Center in Senden (a 32,000 sq m refurbishment completed in 2010 at a cost of EUR12m) is further proof of Rockspring’s expertise in the German retail sector. Our experience, understanding of the market, and relationships with operators allow us to work successfully with our anchor tenants on major retail park refurbishments and ‘face-lifts’ at our properties across Germany. The refurbishments are a powerful demonstration of our team’s asset management skills, enabling us to execute our key strategy to enhance the value of our retail investments on behalf of our investors.”
The Löwen Center, Ostkreuz Center and Iller Center form part of Rockspring’s c. EUR1.2bn gross AUM invested in the German and Swiss retail warehouse market.