January 02, 2018

Baltic Horizon Fund plans to acquire Postimaja Shopping Centre located in the heart of Tallinn

Baltic Horizon Fund plans to acquire Postimaja Shopping Centre located in the heart of Tallinn

Northern Horizon Capital AS, the management company of Baltic Horizon Fund, announces the signing of an agreement with Osaühing Letona Properties to acquire an immovable located in the heart of Tallinn, Estonia at Narva road 1, the Postimaja Shopping Centre (Postimaja) to
Fund’s portfolio.

The key strategical considerations for the Fund making the transaction is the synergy opportunity arising from Postimaja immovable being located next to Coca-Cola Plaza immovable, already belonging to the Fund’s portfolio and the Tallinn’s Main Street project. To achieve that synergy, HG Arhitektuur OÜ with its work The Rotermann Passage has been selected as the partner to work out the architectural solution. It includes a new exterior design as well as increasing the leasable area and aims to improve functionality between the two buildings and in respect to Rotermann Quarter.

The rounded total purchase price to be paid at Closing is €34.4 million (+VAT) whereas the management company has allocated €30.8 million to be paid for the existing cash flow from Postimaja and €3.6 million to be paid for the potential additional cash flow deriving from the possible extension.

The expected acquisition yield for the existing cash flow is approximately 6 percent, the expected acquisition yield for the total purchase price is approximately 5.4 percent. The total current leasable area of Postimaja is 9,141 sqm. The anchor tenants are Rimi, H&M, New Yorker, Estonian Post and MyFitness.

Closing of the acquisition is dependent on receipt of merger clearance from the Estonian Competition Authority.

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