RosEuroDevelopment Group Acquires AURA Shopping Center
OREANDA-NEWS. August 20, 2013. Sberbank CIB announces the completion of an M&A transaction in which the RosEuroDevelopment Group acquired AURA, one of the largest shopping centers in Siberia, from the international development company Renaissance Development and the investment fund Amstar Global Property Fund.
The deal was prepared by the joint Sberbank CIB team and the Severo-Zapadny Bank of Sberbank of Russia, and included specialists from the Client Management Department, Loans Department, and Investment Banking Department of Sberbank CIB, as well as the corporate business departments of the Severo-Zapadny Bank of Sberbank of Russia.
The transaction size is being described as the largest regional commercial real estate transaction in Russia to date. In accordance with the agreements reached between Sberbank CIB and the RosEuroDevelopment Group for the acquisition of the AURA shopping center, a line of credit2 of up to EUR 135 mln for seven years was extended (M&A Acquisition Financing). Financing was arranged by the Severo-Zapadny Bank of Sberbank of Russia.
Nikolai Artemenko, CEO of RosEuroDevelopment, commented: “Today, the retail property market continues to develop. We see growing demand for space in shopping centers, and the acquisition of AURA, one of the best and most modern shopping centers in the region, is an excellent addition to our portfolio. Our team is among the market leaders in the commercial real estate market and we have significant experience managing such objects. As such, we are sure that thanks to our expertise, AURA’s active development will continue. We thank the Sberbank Group for their many years of fruitful collaboration which has allowed us to realize a number of projects.”
Dmitry Kanushkin, Head of the Real Estate Finance Division, Managing Director at Sberbank CIB, said: “Sberbank CIB has proven itself as one of the leaders in the real estate financing market, having actively supported projects nationwide. We have collaborated with RosEuroDevelopment for a number of years and are glad that due to the well-coordinated teamwork displayed by the joint Sberbank CIB team and Severo-Zapadny Bank, we were able to offer the client an integrated solution—investment banking advisory and financing for the acquisition.”
According to James Corrigan, Head of Real Estate in the IB Department, Managing Director at Sberbank CIB, there have recently been several major investment M&A deals in the commercial real estate markets of Moscow and Saint Petersburg. He also said, “The closing of a deal in Novosibirsk demonstrates activation of the market and the existence of demand for quality products in other regions of Russia. Furthermore, this deal was another confirmation of Sberbank CIB’s capabilities in terms of developing an effective scheme for structuring and financing real estate M&A transactions across regions with short deadlines and taking into consideration the changing market conditions.”
Elhan Kerimli, Managing Director of Renaissance Development, expressed his satisfaction with the successful closing of the deal: “This is the largest commercial real estate deal outside of Moscow and Saint Petersburg. We continue to see excellent prospects in the regional market and plan to continue developing our network of large shopping centers under the AURA brand. We are pleased that we were able to work with the market leaders in this project, Sberbank, the RosEuroDevelopment Group, and Amstar Global Property Fund.”
The President of Amstar Global Partners, Jason Lucas, commented that this will be the first sale of Amstar’s Global Property Fund I in Russia: “The sale of SC “AURA” is a clear demonstration of the success of Amstar’s global development strategy of partnering with best-in-class developers like Renaissance, and producing best-in-market assets. Amstar plans to continue to source and invest in Russian development projects alongside our longstanding partner Renaissance, and also hopes to continue to work with Sberbank in financing such projects.”
Providing support to RosEuroDevelopment for the deal were Sberbank CIB as M&A advisor, the legal firm Akin Gump and the audit and consulting firm Deloitte. AECOM provided technical support. Quantum Potes S.A. served as real estate consultant on the deal.
From the sellers’ side, the international legal firm Clifford Chance provided support.
AURA is the largest modern shopping center in Siberia. It was developed by the companies C Concept Design and 5+Design and was built on a 5-hectare plot and in accordance with modern European standards. The company Renaissance Development managed the construction of the shopping center. It was the company’s first project in Novosibirsk.
The total floor space of the shopping center is 150,000 sq. meters, of which 62,000 constitutes retail floor space which house shops, restaurants, and service businesses. The shopping center is intended for visitors of various age groups and income levels.