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 5.96%. 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.
Totalling 35,975 sq m (387,232 sq ft), Meraville Retail Park has been open since 2003 and boasts very strong sales performance, making it one of the top-two performing retail parks in Italy. Featuring a diverse mix of top retail tenants including COOP, Mediaworld, Leroy Merlin and top fashion retailers such as OVS, Pittarello, Alcott and Piazza Italia, the retail park has an occupancy rate of 99.7%.
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."
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%.
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."
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.