2024/01/11 by Poonyapat Luenam Leave a Comment
NPS has held a 75 percent interest in the O’Parinor shopping centre since 2011.
South Korea’s National Pension Service has agreed to sell its stake in the O’Parinor shopping centre in Paris to Sofidy, a real estate investment unit of Temasek-backed Tikehau Capital at 33 percent discount to the asking price in a marketing effort last year.
Sofidy announced earlier this week that it has partnered with French REIT Klépierre to acquire the retail asset in the northeastern suburbs of France’s capital from the NPS and the UK-based real estate firm Hammerson. The asset reportedly swapped hands for approximately €200 million ($219 million).
“The investment is expected to generate a solid double-digit annual return in the first year for the funds managed by Sofidy,” said the French firm, which had €8.7 billion in real estate assets under management as of the end of 2022..
The NPS acquired a 51 percent interest in the 1974-vintage building from Hammerson for €217 million in 2010 before paying an additional €106 million to boost its stake in the property by another 24 percentage points in 2011. The partners had made three previous unsuccessful attempts to to find a buyer for the property, according to local media reports.
Collateralized Property
Renovated in 2008, the shopping centre is located in the Aulnay-sous-Bois commune around a half hour’s drive from the Eiffel Tower. The property’s 70,000 square metres (753,474 square feet) of space hosts stores for brands including Zara, Adidas and Primark.
Kim Tae-hyun, chairman and chief executive officer at South Korea’s National Pension Service
The acquisition, set to close in early 2024, will be 75 percent-funded by Sofidy, with Klépierre handling the rental and property management and providing the remaining 25 percent.
Hammerson, which had borrowed £45 million ($57 million) against the asset, said that lenders took control of its stake last June, resulting in losses of £22 million.
The partners had been seeking £300 million for O’Parinor, and had enlisted Cushman & Wakefield and Knight Frank in July 2023 to handle the sale.
In the first nine months of 2023, investment in French retail assets stood at €2.2 billion, down 54 percent from the same period a year earlier according to a report from Cushman & Wakefield.
Korean Investors Going Overseas
The NPS, which had KRW 52.1 trillion in assets under management as of September 2023, continues to be one of Korea’s most active players, with the latest disposal taking place around two months after the fund acquired a minority stake in San Francisco-based real estate private equity firm Stockbridge Capital Group.
Last July, the NPS sold a 50 percent stake in an Australian industrial property portfolio for A$500 million ($335 million), transferring ownership of 20 assets in Sydney and Melbourne to local pension fund UniSuper.
The shopping centre disposal took place as Korean investors continue to play a larger role in the global market, with the country’s sovereign wealth fund Korea Investment Corporation (KIC) investing KRW 200 billion in an Apollo Global Management buyout fund in September.
In February last year, the Singapore unit of Seoul’s IGIS Asset Management launched a fund for life science real estate investments across Asia Pacific, with the firm expecting to raise a total of KRW 810 billion for the platform.
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