Joint venture between a real estate fund managed by MSREI and redos unites all assets at Rhein-Ruhr Zentrum in 3 transactions

Joint venture between a real estate fund managed by MSREI and redos unites all assets at Rhein-Ruhr Zentrum in 3 transactions

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Hamburg, 28 February 2018 – The Rhein-Ruhr Zentrum in Mülheim an der Ruhr is to be extensively refurbished. After acquiring the shopping centre together with the adjacent Karstadt Arkaden and office tower with a combined rental space of 138,000 sq m, the joint venture between the “North Haven Real Estate Fund IX Global” managed by Morgan Stanley Real Estate Investing (MSREI) and redos real estate wants to make the Rhein-Ruhr Zentrum fit for the future. The aim is to increase the quality of time spent in the centre, to offer customers larger variety and services, and thereby to extend the length of stay. The site was acquired in three individual transactions. The Rhein-Ruhr Zentrum was sold by Blackstone and ECE, the office tower by a fund managed by Bouwfonds.

Rhein-Ruhr Zentrum to be converted into a shopping centre of the next generation

Offering over 80,000 sq m of total gross leasable area, around 180 rental units and various entertainment facilities, the Rhein-Ruhr Zentrum is one of the five biggest shopping centres in Germany. With the shopping centre, the Karstadt Arkaden and the office tower, all relevant parts of the site were united. This allows the new owners to consolidate site development and to serve the strong catchment area in line with demand. The Rhein-Ruhr Zentrum opened in 1973. Although investment in the centre has been lacking over the years, it still is one of the most popular shopping centres in Germany.

“By implementing an attractive and contemporary sectoral mix including innovative entertainment facilities, we are establishing the Rhein-Ruhr Zentrum as a generation 4.0 shopping centre,” said Oliver Herrmann, Managing Director / Head of Business Development at retail property specialist redos. “When selecting tenants, we will pay
particular attention to their omni-channel capabilities in order to respond both to changing customer demand and our development targets,” Herrmann concluded.

Joint transactions with a volume of EUR 2.5 billion

This acquisition marks the seventh joint transaction by MSREI-managed funds and redos. The joint venture, which was created in 2010, has acquired the “Bavaria”, “Horn” and “Tobago” portfolios, among others, as well as the “Christie” portfolio with four hybrid shopping centres. Altogether, these transactions had a volume of EUR 2.5 billion.

The Rhein-Ruhr Zentrum was brought to the market by Eastdil and iMallinvest. The sale of the office tower was brokered by Angermann Berlin. The joint venture partners were advised on the acquisitions by law firm Latham & Watkins Hamburg as well as Drees & Sommer, Terraplan and Ernst & Young. Blackstone and ECE were advised by Greenberg-Traurig, Bouwfonds by Dentons. HSH Nordbank was responsible for the financing. All deals for the site were closed in the first quarter of 2018.

About Morgan Stanley
Morgan Stanley is a leading global financial services firm providing investment banking, securities, wealth management and investment management services. With offices in more than 42 countries, the Firm’s employees serve clients worldwide including corporations, governments, institutions and individuals. For more information about Morgan Stanley, please visit www.morganstanley.com.

About Morgan Stanley Real Estate Investing
Morgan Stanley Real Estate Investing is a leading global real estate investment platform which has been one of the most active property investors in the world for more than two decades. MSREI employs a patient, disciplined investment approach to manage global opportunistic to core investment strategies on behalf of its clients. With offices throughout the U.S., Europe and Asia, regional teams of dedicated real estate professionals combine a unique global perspective with local presence and significant transaction execution expertise.

About redos
The redos Group is a leading independent retail property specialist. It focusses on investment, asset management, fund management, redevelopment and advisory. As an investor and active asset manager, the company covers the entire value chain for large-scale retail properties – for hybrid and conventional shopping centres as well as for retail parks and hypermarkets. redos serves all risk classes and offers all types of investment vehicles for institutional investors. In addition to acting as a co-investor, the company has strong ties to its tenants and extensive revitalisation expertise. redos looks back on a long track record in the field of restructuring and value optimisation. The retail property specialist currently manages a portfolio worth around €2 billion at 56 locations throughout Germany and a total of 813,600 sq m of rental space. With its property database ROB, the company has access to detailed information on more than 17,500 retail locations nationwide. The redos Group has 42 employees at its head office in Hamburg and in Lohmar nearby Cologne. For further information visit www.redos.de.