Financial and investment group WOOD & Company, as the leader of the transaction together with joint venture partner Tatra Asset Management, bought a majority stake in Aupark from Unibail-Rodamco-Westfield in 2021. At that time, it was the largest single-asset real estate acquisition in Slovakia with a total value of 450 million euros. The acquisition of the shopping center was planned for three tranches. In the first, the investors obtained a 60 percent share, which increased to 87 percent in 2022 according to the agreed terms. The last tranche and completion of the purchase is planned for this year.
Since its inception, the sub-fund has brought interesting appreciation. In the last 12 months, it has delivered returns of 9.48 percent in euro class to its investors. "Despite the fact that the acquisition took place during the corona crisis, when skeptical opinions about the future of retail were also heard, time has confirmed the quality of our analyzes and in-depth knowledge of the market. The purchase of Aupark proved to be the right step in the strategy of acquiring high-quality and attractive properties for our sub-funds. The almost 10 percent return over the last year is a clear signal for investors that such properties are still worth investing in and have a strong place in their portfolio," said Martin Šmigura, Local Partner WOOD & Company.
Development of the performance of the AUP Bratislava sub-fund since its establishment in 2021. Over the last 12 months, the fund has achieved an appreciation of 9.48 percent in the euro class.
The income strategy of the AUP Bratislava subfund is based on regular dividend payments with a targeted average annual dividend yield of five to six percent. In addition, the external debt ratio is set at a conservative level of around 50 percent. "Aupark complements our real estate portfolio and at the same time represents an exceptional investment opportunity for our clients with stable returns and a favorable risk-return ratio," adds Šmigura.
The investment benefits from the location or premium tenants
Aupark offers 231 units for rent. Neither the pandemic nor inflation significantly affected the occupancy of the shopping center, which remains at 98 percent.
The location in which Aupark is located is also a significant factor in the high occupancy rate and interest from tenants. "The location gives us a competitive advantage, as we are the only shopping center on the right bank of the Danube, i.e. in an area where almost 120,000 people live in Petržalka alone. To this must be added the advantage of the historical center of Bratislava being accessible on foot and the close proximity of the Hungarian and Austrian borders," states Šmigura. Millions of visitors visit the shopping center every year, whose purchasing power is 42 percent higher than the Slovak average.
Illustrative graphics from data available online as of April 25, 2024, which shows the growth potential of the Petržalky location.
In addition to the possibility of shopping, the Aupark also offers them a place to spend their free time. In the neighborhood there is the oldest and at the same time one of the largest parks in Bratislava, Janka Kráľ Park, connected by a bicycle path and several residential and office buildings. Several development projects are underway or planned in the vicinity, which will strengthen the catchment area of Aupark, as well as the potential for an increase in the value of the asset.
The largest green facade in Slovakia will contribute to sustainable operation
The expansion of Aupark in the form of a new extension in the front part of the shopping center is also taking real shape. Its opening is scheduled to take place already in the fall of 2024. The result will be an increase in the commercial area of the shopping center by 6,000 square meters.
Thanks to this, space will be created for other global, as well as domestic brands with a premiere on the Slovak market. It is worth mentioning the expansion of the existing brands Bershka, Pull & Bear and Zara. With its expansion, the latter brand will bring a new, state-of-the-art concept that will become its flagship on the Slovak market. In Aupark this year, the globally popular EL&N London cafe will present its first operation on the Slovak market. It has a strong position on social networks thanks to targeting the young generation and the attractive interior design of the premises.
Part of the expansion is also the strengthening of the sustainability position. Since 2014, the center has been a holder of the BREEAM In-Use certificate at the 2x Excellent level, which is one of the most prestigious in the assessment of building sustainability. At the end of the summer, a green facade with almost 40,000 plants, grown especially for this purpose, is planned to be installed on the extension. With an area of approximately 600 m2, it will be one of the largest projects in Slovakia and the Czech Republic. In a busy part of the city, it will contribute to the improvement of microflora, reduction of noise and dust, but also increase of natural humidity.
The structure consists not only of steel elements, but also of refurbished aluminum frames and glasses from the original facade. Additional photovoltaic panels will also be added to the Aupark, the ones currently on the roof of the parking building ensure the annual production of electricity, which is equivalent to the consumption of approximately one hundred thousand cubic meters of natural gas, 250 tons of CO2 and hundreds of kilograms of other saved emissions. An equally wide infrastructure of charging stations for electric cars, or the option for charging bicycles and scooters, contributes to sustainability.
"Not only us, but also the previous owners systematically invested in the building, which we plan to continue in the coming years. The expansion of the shopping center offers visitors even more opportunities to enjoy their free time and reasons to return," concludes Šmigura.