Citycon Oyj and NCC Property Development Oy (NCC) have today purchased the land plot and building rights for retail premises and apartments adjacent to the future Matinkylä metro station on the western metro line. At the same time, the companies agreed to jointly start the first phase of the Iso Omena extension and (re)development project covering a 30,000 square metre extension connected to the future metro station.
Citycon and NCC have made a EUR 120 million investment decision concerning the first phase of the extension based on a 50-50 partnership. The estimated cost for the three phase project including partial (re)development of the existing shopping centre totals approximately EUR 175 million. Citycon estimates the yield at completion when stabilized to be between 6.5 and 7.0 per cent. The construction work will commence in June and the extension will be ready in two stages. The metro centre transport terminal and adjacent retail space will be opened at the same time as the western metro line, in late 2015. The shopping centre extension will be completed in the late summer of 2016.
The extension project will be done in close co-operation with Länsimetro Oy. The end station of the western metro line, now under construction, will be located under the shopping centre Iso Omena, along with a bus terminal. Länsimetro Oy, jointly owned by the city of Espoo and the city of Helsinki, will fully finance the construction cost of the bus terminal and commuter parking.
The extension expands the leasable retail area of the centre by approximately 25,000 square metres. The retail area of Iso Omena will be approximately 75,000 square metres after the project and the gross leasable area approximately 90,000 square metres. The pre-leasing rate is about 35 per cent. The retail mix of Iso Omena will increasingly be focused on fashion stores and a wide offering of restaurant services. Citycon estimates the footfall of the centre to increase by 60 per cent and the sales to increase by 45 per cent after the extension.
Marcel Kokkeel, CEO of Citycon comments: ”Citycon’s strategy is to manage, own and develop grocery anchored urban shopping centres in growing cities. Iso Omena’s operating performance over the last couple of years has been strong in terms of footfall and NRI growth with close to a 100 per cent occupancy rate. Iso Omena is uniquely placed to further strengthen its position in one of the fastest growing and most affluent parts of the Helsinki metropolitan area”.
Marko Juhokas, Senior Vice President of Development and Sustainability in Citycon continues: ”The tenant demand for Iso Omena is good and we want to secure the best tenant mix for the extension. The combination of a large retail offering, public services, library, bus terminal and versatile restaurants will make Iso Omena a lively and interesting place for our customers to spend time and enjoy shopping”.
Iso Omena is Citycon’s largest shopping centre in Finland and it offers over 120 different retail stores and services. The shopping centre was opened in 2001 and Citycon purchased the centre in 2007. In 2012, Iso Omena generated sales of EUR 260.4 million from a footfall of 8.8 million visitors.
Helsinki 31 May 2013
For further information, please contact:
Marko Juhokas, Senior Vice President of Development and Sustainability
Tel. +358 20 766 4422 or +358 40 735 4997
Marcel Kokkeel, CEO
Tel. +358 20 766 4521 or +358 40 154 6760
NASDAQ OMX Helsinki