Shopping Centre Opened in London - Commerz Real

Press Release
7 November 2008
hausInvest europa: Vast “Westfield”
Shopping Centre Opened in London
■ Open-Ended Real Estate Fund of Commerz Real Holds 50 Percent
Stake in Europe’s Biggest Shopping Mall
■ Property Stands out by Virtue of its Wide Product Spectrum and
Infrastructural Benefits
■ Positive Performance of the “hausInvest” Funds through Successful
Lease Management
The newly-opened “Westfield” has given London the largest shopping centre
in Europe. The “hausInvest europa” fund of Commerz Real acquired the
project development in summer 2004 from Westfield Group, a prestigious
shopping centre development company. The total investment volume came to
2 billion euros, making it the biggest single investment ever undertaken by a
German fund company in the United Kingdom.
Extending over a retail floor space of more than 150,000 square metres, and
offering 265 store units for providers of the most diverse product and price
segments, as well as 40 gastronomic venues, the “Westfield” sets new
standards for London’s retail sector. Moreover, a 16-screen cinema complex
will be added in 2009. On the whole, the project has created more than 7,000
new jobs. The mall was raised west of downtown London, less than five
kilometres from Oxford Street, the city’s shopping hub. The project
development involved extensive infrastructural measures. In addition to 4,500
parking spaces with direct motorway access, new underground stations and a
new bus terminal were built.
Beyond that, the shopping centre contributes in essential ways to the
continued urban and social development of the White City/Shepherd’s Bush
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district. The “Westfield” mall will trigger new construction projects, and have
an integrative function for the surrounding area through its participation in
projects such as housing construction, the setup of a public library and the
redecoration of the Sheperd’s Bush Green recreational area nearby.
The deed for new “Westfield” that was signed in 2004 provided that the
Westfield Group project development company would, upon completion, take
over 50 percent of the shopping centre within the framework of a joint venture
with Commerz Real. “hausInvest europa” received the corresponding
proceeds in late October 2008.
“With this ‘Westfield’ mall, a benchmark on the European shopping centre
market has been created,” elaborated Hans-Joachim Kühl, Member of the
Board of Commerz Real and in charge of real estate acquisitions. “Together
with the Westfield Group, a partner renowned and experienced in the
shopping centre segment, we will make this project a long-term success." On
top of that, Kühl sees additional investments potential in the greater London
area. “Following several years of abstinence due to inflated prices, we
acquired real estate with an aggregate volume of 300 million euros there
during Q3. Most recently, the open-ended real estate funds have been the
most active group of investors in London. The industry is currently very
reticent in its activities in face of the extreme sense of uncertainty on the
financial markets. As soon as the market conditions permit it, we will intensify
our efforts to take advantage of attractive investment opportunities.”
At the time of the grand opening of the “Westfield” mall, 95 percent of the floor
space was already let, mostly to internationally active retailers. “The
successful marketing of the ‘Westfield’ and the projected long-term rental
income will make an essential contribution to the positive performance of
‘hausInvest europa’,” said Hubert Spechtenhauser, Spokesman of the Board
of Directors of Commerz Real AG. “Even under the currently difficult
conditions we will realise annual returns of over 5 percent for our investors.
The same is true, by the way, for 'hausInvest global', our globally invested
fund."
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Together, “hausInvest europa” and "hausInvest global” represent a total fund
volume of 11 billion euros. The real estate assets include 100 properties with
a gross area of about 3 million square metres. Both funds are widely
diversified in terms of regions, types of use, and tenant structures, and are
thus largely autonomous of economic developments on individual markets.
Occupancy rates approximate 95 percent for either fund. In the case of the
“hausInvest europa”, financial service providers account for a share of about
20 percent, while in the case of “hausInvest global” they represent less than
10 percent. As Spechtenhauser elaborates: “So far, we have no increased
rent losses to report before the background of the financial crisis. We
negotiate predominantly long-term leases. Our tenants are high net worth
companies from all kinds of industries. What is more, the portfolio of either
hausInvest fund is stocked with first-class real estate in sought locations,
enabling us to re-let swiftly at attractive conditions whenever a given tenant
moves out.”
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Short Profile of Commerz Real AG
Commerz Real AG is a fully owned subsidiary of Commerzbank AG. With
approximately 44 billion euros in assets under management, and a staff of
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about 1,000 professionals in 20 locations inside and outside Germany,
Commerz Real AG counts among the world’s biggest real estate asset
managers and providers of structured leasing and investment solutions.
Business focus is the provision of investment products, such as open-ended
and closed-end real estate funds, institutional real estate funds, REITs,
closed-end funds for ships, aviation, and renewable energy. The spectrum of
services includes moreover the area of structured investments, which
combines the activities of real estate leasing, big ticket leasing, and structured
financings, as well as equipment leasing.
Commerz Real AG
Mercedesstrasse 6
40470 Düsseldorf
Kreuzberger Ring 56
65205 Wiesbaden
Press Contacts
Markus Esser
Head of Corporate Communications
Contact for Public and Institutional Real Estate Funds
Tel.: +49 (0)611 7105-485
Fax: +49 (0)611 7105-289
E-mail: markus.esser@commerzreal.com
Karolina Müller
Head of Brand Communications
Contact for Closed-End Funds, Leasing
Tel.: +49 (0)211 7708-2563
Fax: +49 (0)211 7708-3562
E-mail: karolina.mueller@commerzreal.com
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