Austrian financial group Immofinanz is in talks to buy one of Romania's largest industrial parks - IRIDE, under a transaction that could be worth more than $50 million, according to sources close to negotiations.
Should the deal be closed, Immofinanz would take over IRIDE through its East-European arm of realty investments, Immoeast. IRIDE is currently held by two Italian companies (BPD Property Development and Finest), the Romanian Post Privatisation Fund (RPPF) and the European Bank for Reconstruction and Development (EBRD).
IRIDE is valued at 80-90 million dollars, minus debts amounting to $30 million, mainly banking loans granted by the EBRD and Raiffeisen Bank, the quoted sources say.
The IRIDE sale to Immofinanz may thus turn into the biggest real estate transaction on the Romanian market so far.
"There are talks over IRIDE, but I am not at liberty to say anything for the time being," said Robert Luke, general manager for Romania of GED Capital, the company managing the Romanian Post Privatisation Fund.
Immofinanz officials would not comment on negotiations over IRIDE, either. IRIDE is Romania's largest industrial and business park, located in Bucharest's Pipera area.
The companies that have rented industrial or office space at IRIDE include big names such as Raiffeisen Bank, XEROX, JTI, Medicare, Nestle, Moeller Electric and Whirlpool.
According to unofficial sources, IRIDE rakes in more than 10 million dollars annually from rents.
Raiffeisen Bank and IRIDE last year closed one of the market's biggest renting deals. The bank rented 10,500 square metres of office space for ten years. Thus, Raiffeisen alone pays $2m annually, as the monthly rent for class A office space amounts to 16 euros/ sq metre.
Talks over the sale of IRIDE started last fall, and the two parties signed a memorandum of understanding last week, to kick off price negotiations, the quoted sources say. Talks on the park's sale were prompted by the increasing interest displayed by international and regional realtors in the Romanian market.
The market of big realty transactions saw a boost last year, when Opera Center was bought by the Austrian investment fund CA IMMO, the real estate arm of Creditanstalt group. The transaction was worth $29 million.
Another significant deal saw the acquisition of Europe House (which counts Orange as the main tenant) by Europolis, an investment vehicle owned by Austrian company Investkredit Bank AG and by the European Bank for Reconstruction and Development. The transaction was worth more than $30 million.
The IRIDE project was launched in 1998 by Italian realtor BPD Property Development and by the EBRD, with the latter being both a shareholder and a lender.
The Romanian Post Privatisation Fund (one of Romania's largest investment funds) and Italian company Finest entered the business in 1999.
At the end of 2002, IRIDE had 8,800 square metres in office space and 13,000 square metres in industrial spaces.
laurentiu.ispir@zf.ro
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