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STOCKHOLM-The locally headquartered property company Kungsleden AB has acquired 32 retail properties across Sweden totaling 1 million sf for $98.2 million (euro 80 million). The majority of the properties are let to the supermarket and department store operators Axfood and Åhlens.The seller is JER Partners of McLean, VA, which purchased the portfolio in 2004 for $78.5 million (euro 64 million). JER officials say the company’s yield on the transaction was 7.5%.

At the time JER acquired the Sweden portfolio, the lease maturity profile of the portfolio was very short. Since then, JER has renegotiated leases representing close to half of the space in the portfolio. A company source tells GlobeSt.com the renegotiated leases, which he described as extensions, “significantly increase the maturity of the portfolio,” but would provide no further detail.

JER is the private equity investment arm of J.E. Robert Companies. The sale is consistent with JER’s European strategy of identifying and acquiring undervalued assets, improving their cash flow and then selling to investors with a preference toward stable and cash generative properties.

For Kungsleden, the acquisition builds on its previous acquisitions of 27 retail properties from ICA, according to a prepared statement by Kungsleden’s chief executive Jens Engwall. Neither Engwall nor a JER executive was immediately available Wednesday afternoon for further comment.

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