Equest Balkan Properties goes shopping in Iasi

Equest Balkan Properties, a British property investment company focused on commercial, retail and industrial property in South Eastern Europe and primarily Bulgaria and Romania, yesterday announced the acquisition of the Moldova Mall, a retail mall in central Iasi, Romania, for 34.5 million euros.

According to a release of the company, the Moldova Mall shopping mall comprises 19,000 square metres of built area and 9,500 square metres of lettable retail space on five levels.

Equest Balkan says that the unleveraged investment yield on full occupancy is estimated to be in excess of 9%. Moldova Mall belongs to the Moldova group of companies controlled by Danut Prisecariu.

Prisecariu did not care to provide further details. “We will hold a press conference next week when the shopping centre reopens and will provide additional comment at that time,” the businessman from Iasi told ZIARUL FINANCIAR. This is not EBP”s first acquisition on the Romanian market, as it bought an almost 5 million euro office building in Bucharest early this year. “We are in talks for other projects in Bucharest and in the rest of the country,” Ionut Costea, member of Equest”s Board told ZF. He is also the chairman of Raiffeisen Banca pentru Locuinte, but his position with EBP is not executive.

The mall was initially built in 1972 as the central department store in Iasi. During the past 18 months, the mall has been completely refurbished and it is anticipated that it will be re-opened to the public by the end of March 2006.

The mall currently has 95% of the lettable area contracted to more than 100 individual tenants, with anchor tenants including Altex (largest electronics retailer in Romania), Glendale Multiplex Cinema, Pizza Hut and KFC.

Additionally, the Moldova Mall has above-ground parking for 150 cars and the opportunity for underground parking for a further 250 cars and a land plot for developing up to 1,000 square metres of additional retail space. “We expect to add further value through the active management of the asset, which will include the planned development of underground parking and additional retail space for food retail. The mall has a prominent location on one of the main streets in Iasi, Romania”s second largest city, and is one of the landmark buildings in the city,” said Petri Karjalainen, managing partner of Equest Partners Limited, EBP”s investment adviser.

Equest Balkan Properties is managed by Equest Capital Management Limited and Equest Partners Limited and is mainly interested in commercial investments that provide high yields and a potential for capital appreciation. Equest Balkan Properties” shares commenced trading on the Alternative Investment Market (“AIM”) on December 14, 2005, having raised 140 million pounds sterling to invest in the target region in or around the major cities of Bulgaria, Romania, Albania, Bosnia & Herzegovina, Croatia, FYR Macedonia, Serbia & Montenegro and Turkey.

“The Moldova Mall in Iasi is one of the exclusivities we had mentioned during the EBP flotation and we are pleased to have completed on the purchase following a period of full technical and financial due diligence,” Petri Karjalainen stated.