CITYCON HAS ACQUIRED THE KOSKIKESKUS AND KOSKIKARA SHOPPING
Citycon Oyj, which specialises in commercial premises for the
retail trade, has acquired Polar Real Estate Corporation's
holdings in Tampereen Koskikeskus and Valkeakosken Koskikara.
Citycon also made a preliminary contract for the acquisition of
Seinäjoen Torikeskus. If the terms of the preliminary contract are
fulfilled, the transaction will be effected on 27 February 2004.
The acquisitions will underpin Citycon's strong position on the
Finnish market for retail premises and reinforce the Shopping
Centres Division, which is part of the company's core competence.
The combined price for Tampereen Koskikeskus and Valkeakosken
Koskikara is 49.3 million euros. The net yield of the properties
on their purchase price at the date of the transaction is roughly
7.9 per cent. To finance the transactions, Citycon Oyj is taking a
45 million euro long-term loan. The period and terms of the loan
correspond to those of the loan made in November 2002. The main
arranger of the syndicated loan is Nordea Bank Finland Plc, with
Svenska Handelsbanken AB, Eurohypo AG and HSH Nordbank AG as the
The transaction will make 191 current tenants in the properties
customers of Citycon. Citycon estimates that the deal will boost
the Shopping Centres Division's net rental income by roughly 3.9
million euros annually or roughly 13.2 per cent.
Koskikeskus is the most varied shopping centre in the Tampere
economic zone and it is located in the city centre. The
transaction makes Citycon the owner of all the retail facilities
in the property. The total sales of Koskikeskus have grown at 8-11
per cent per year over the past four years, which is twice the
overall trend in this business. An extension amounting to roughly
15,000 square metres of commercial space has been planned for
Koskikeskus. Work has been started on the planning permission
required for the project.
Valkeakosken Koskikara is in the Tampere market area, in the heart
of the city of Valkeakoski. Koskikara is a vigorous shopping
centre in an excellent business location with good access.
Summary of the newly acquired holding
Retail space, sq.m. 13,444 5,671
Rental occupancy rate
of retail premises, % 100% 100%
Number of tenants 158 33
Average length of
leases, year 3.3 1.5
Summary, entire shopping centre
Number of visitors,
million* 6.3 2.5
Total sales, m* 111.0 35.0
Population 306,000 34,000
Year of completion 1988 1993
Citycon's floor area in
the shopping centre after
the transaction, sq.m. 28,000 5,800
Citycon's holding in
the shopping centre after
(before in brackets) 88%(27%) 55%(0%)
*Estimate for 2002
"The new acquisitions will underpin Citycon's core competencies.
The substantial increase in our holdings in Koskikeskus and
Koskikara will strengthen Citycon, but above all they will give
the properties themselves a boost. By owning a number of shopping
centres we are able to enhance their business and strengthen their
market position more effectively than before. Once completed, the
major extension planned for Koskikeskus will further improve its
position as the biggest and most competitive retail unit in the
city centre," says Citycon's CEO Petri Olkinuora.
Seinäjoen Torikeskus is one of the leading shopping centres in the
large market area of Southern Ostrobothnia. The shopping centre
was visited by an estimated 1.8 million customers in 2002 and its
total sales were roughly 16.0 million euros. The purchase price of
Seinäjoen Torikeskus is 7.0 million euros. The net yield of the
property on its purchase price at the date of the transaction is
roughly 8.6 per cent.
Citycon is the Finnish market leader for shopping centre business.
After the transaction, the company owns a total of 15 shopping
centres in the Helsinki Metropolitan Area and other regional
centres in Finland. The estimated total sales of the shopping
centres after the transaction are 721 million euros a year and the
leasable area owned by Citycon totals 203,000 sq.m.
In addition to shopping centres, Citycon also owns 133
supermarkets and shops. The balance sheet value of the company's
entire property portfolio after the transaction now effected is
722.8 million euros, of which shopping centres account for 58.0
per cent and supermarket and shops for 42.0 per cent.
Board of Directors
CEO Petri Olkinuora
Tel. +358 9 680 36 738 or +358 400 333 256
Distribution: Helsinki Exchanges and key media