Swedish Retail Portfolio Fetches $580M-Plus

STOCKHOLM—Starwood Capital Group, says an affiliate of the firm has acquired seven shopping centers in prime locations in Sweden from Kooperativa Forbundet (KF), a leading Swedish retail group, for approximately $587 million (SEK 3.9B). Starwood was joined in the deal by Vencom, which is a minority investor and will serve as the operating partner for the properties.

Located in Sweden's four largest cities – Stockholm, Gothenburg, Malmo and Uppsala— the seven properties comprise approximately 205,000 square meters. The transaction also includes existing building rights for an additional 70,000 square meters of expansion space spread over three of the locations. The properties are currently 96% leased and each location is anchored by a Coop, Sweden's second-largest supermarket chain. In addition to Coop, the tenant roster is comprised of well-known Swedish and international retailers such as XXL, MediaMarkt, H&M and Systembolaget.  As part of the transaction, Starwood has extended the Coop leases at four of the seven locations, nearly doubling the weighted average unexpired lease term.

"These seven properties are a tremendous addition to our growing portfolio in Europe, particularly given the attractive fundamentals of these assets," said Jeff Dishner, senior managing director at Starwood Capital Group. "The balanced and steady growth of the Swedish economy, the prime location of these assets and the strong tenant profile fit perfectly with our investment focus. We look forward to working alongside our partner Vencom to unlock additional value at these assets and realize their full potential."

Aareal Bank and Helaba are acting as joint arrangers of the financing; Aareal carries out the role as facility agent and security agent. CBRE and Lindahl also advised Starwood Capital Group and Vencom on the transaction.

Starwood Capital Group is a private, U.S.-based investment firm with a core focus on global real estate.  Since the group's inception in 1991, the firm has raised more than $22 billion of equity capital and acquired over $44 billion in assets.