France: Carrefour invests €2 billion in shopping centres
French hypermarket chain has announced a €2 billion investment in retail space by acquiring a 127-strong portfolio of shopping centres from real estate group Kleppiere, Reuters reports.
Carrefour stated that it intends to pool the shopping malls – based in France, Italy and Spain – with its existing 45 shopping centres in France, creating a new company with 800,000 square metres of retail space and €2.7 billion in assets. The company will be made up of €1.8 billion of equity, 58% of which will be held by institutional investors. It will also be backed by €900 million of debt, Carrefour said.
By owning not only the hypermarket but also the surrounding shopping centre, Carrefour will be able to derive rental income, according to Reuters. This income will then be used to revitalise 150 of its 220 hypermarkets in France over a period of three years.
Carrefour has struggled in recent times to retain market share in the face of rivals such as E. Leclerc and Systeme U. It has also had to cope with the gradual decline of its core hypermarket model as consumers choose to shop more locally and online.
Source: Reuters /media reports