Agreement reached on sale of high street SC in Riga Old Town for EUR 75 million

31 maja 2019

Newsec in the Baltics advised on the sale of the historic Galerija Centrs high street shopping centre in Riga, Latvia. The shopping centre, owned by Norwegian real estate developer Linstow, has been acquired for 75 million euros by Baltic Horizon Fund. It was this year’s largest shopping centre transaction in the Baltics and with this acquisition, Baltic Horizon Fund will become the largest diversified commercial real estate investment fund in the Baltics with close to EUR 350 million assets under management.

Newsec is pleased to have advised Linstow, one of largest Norwegian assets managers in the Baltics, on the successful disposal of a sizeable high street shopping centre in the heart of Riga in Latvia. This transaction with a local fund, the Baltic Horizon Fund, supports our firm belief that the demand in the market for top properties is very strong, and that liquidity on the Baltic real estate market will only further improve. We’re happy to finalize a first joint project in the Baltics with our alliance partner BNP Paribas. This is in line with our ambition to grow as a pan-Baltic business

Andrius Švolka, Dyrektor działu ds. transakcji w Newsec w krajach bałtyckich

The joint approach of Newsec and BNP has a great value and transfers into positive results for our clients

Mateusz Skubiszewski, Deputy Head of Capital Markets CEE, BNP Paribas Real Estate

Zdaniem A. Švolka, centra handlowe usytuowane przy głównych ulicach handlowych w centrach miast są postrzegane jako najbezpieczniejsze inwestycje. W perspektywie historycznej gwarantują one najbardziej stabilne stopy zwrotu na rynku nieruchomości. Właśnie dlatego centrum Galerija Centrs jest zwane perłą branży handlowej w basenie Morza Bałtyckiego. To określenie zawdzięczamy nie tylko prestiżowemu położeniu na Starym Mieście, czy też imponującej odwiedzalności generowanej przez obiekt – ponad 7 mln gości rocznie – ale także długotrwałej obecności znanych marek. Obiekt o powierzchni 20 000 mkw. mieści obecnie ponad 110 najemców.

Owning and managing Galerija Centrs has been a fantastic journey for Linstow. We take pride in the development and management of complex urban regeneration projects, of which Galerija Centrs is a very good example indeed. This divestment will open up new opportunities for Linstow, as we see ourselves as a long-term investor in the region. Furthermore, we would like to express our satisfaction about work with all the parties involved in this successful transaction.

Frode Gronvold, CEO of Linstow Center Management

We are very pleased to add such a stable landmark property to our cash-flow portfolio. After the acquisition, the fund will own a centrally located retail asset in the heart of every Baltic capital: Galerija Centrs in Riga, Postimaja in Tallinn and Europa Shopping Center in Vilnius. With this position, we strive to become a long-term prime landlord partner for top retailers in the market who look to develop their current and new brand portfolios in the Baltics.

Tarmo Karotam, the fund manager of Baltic Horizon Fund

Galerija Centrs is a historic building in the Riga Old Town. It has been a site for retailing since as far back as 1938, and several years ago the building marked its 80th anniversary. The shopping centre was fully modernized in 2006, with an expansion of its footprint to neighbouring Ridzene Street and an updated appearance. After the renovation, Galerija Centrs became one of the first shopping centres in the Baltic countries with a glass facade. Those successful changes strengthened its position as an exclusive shopping centre in Riga.