EBRD finances shopping centres across Ukraine
The FINANCIAL -- The EBRD is extending a loan of up to $139.3 million to three special purpose companies, which will own and operate three modern shopping centres across Ukraine . The companies are incorporated in Ukraine and wholly owned by Expert Capital S.A. a property developer registered in Luxembourg.
The loan will be disbursed in two tranches: tranche one of $ 100 million and tranche two of up to $ 39.3 million. Up to $ 71.9 million of tranche one will be syndicated to commercial banks. Tranche two, which will also be syndicated, will be disbursed subject to the borrowers’ performance and project implementation.
The transaction, which is the largest for the Bank in the Ukrainian real estate sector to date, will enable the client to finance the design, development, construction, ownership and operation of three modern shopping centres located in the cities of Kiev , Krivoy Rog and Simferopol. Their total combined gross building area will be 109,657 square metres and combined parking area will be 110,991 square metres.
The shortage of international developers combined with the steadily growing demand for higher standard properties has resulted in a shortage of good quality properties across all real estate sub-sectors in the country. Ukraine still lags behind its neighbour countries, in terms of modern retail space per capita. At the beginning of 2007 the level of the quality retail space was around 115 square metres per 1,000 inhabitants (compared with 200 square metres in MOSCOW , 600 in Warsaw and over 1,000 London).
According to EBRD Ukraine Country Director Kamen Zahariev, the project represents an opportunity for the Bank to support the expansion of a successful international real estate developer into the Ukrainian market. It will have a specific focus on the regions thereby introducing a new shopping mall format in secondary Ukrainian cities, most of which are still dominated by old-style retail facilities and open markets, he added.
The European Bank for Reconstruction and Development is the biggest financial investor in Ukraine . As of January 2008 it had committed over €3.2 billion through more than 161 projects.
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