Hystead, owner of a shopping center, will receive 164 million euros in loans
The EBRD and IFC, a member of the World Bank Group, are boosting the retail sector by SerbiaMontenegro and FYR Macedonia with €164 million in loans to the Hystead investment company.
Hystead is a London-based company and a significant investor in the Western Balkans. It owns the Delta City shopping centers in Belgrade and Podgorica as well as the Skopje City shopping center.
The financial package includes a loan of 60 million euros from the EBRD and a loan of 104 million euros from the IFC. IFC’s financing includes a €60 million ‘A’ loan from its own account and a €44 million loan from IFC’s Managed Co-Lending Portfolio Program (MCPP). Funding for the IFC MCPP loan is provided by the People’s Bank of China.
The funds will refinance an existing loan and improve the company’s capital structure. They will also support the expansion and modernization of the three shopping centers.
Improvements will focus on the adoption of international environmental and social standards, implementation of green building practices, efficient use of energy, rational management of water and resources, minimization and recycling waste, as well as the use of high-performance equipment and technologies. These improvements will allow the company to certify the shopping centers under an international sustainability program. The shopping centers in Skopje and Podgorica will be the first in their respective countries to receive such certification. Their example will pave the way for more sustainable building management in the region.
Additionally, Hystead is committed to creating opportunities for young people and preparing them for the job market. The company plans to partner with local educational institutions in the three countries to develop programs on sustainable building management.
Additionally, the IFC and EBRD loans will help Hystead become a platform to attract future financing for commercial real estate growth in the Eastern European region.
In the Western Balkans region, local companies operating income-generating commercial properties have been unable to access international capital markets to finance their growth. These companies have not yet been structured as REITs and lack the size, diversification and standards required by international and regional institutional investors.
With the help of IFC and EBRD financing, Hystead, a real estate investment trust focused on commercial real estate assets in the region, will address these challenges. Hystead intends to bring together a diverse portfolio of quality income-generating commercial properties with the scale, standards and diversification to attract institutional investors seeking real estate exposure in the region.
Alex Papageorgiou, CEO of Hystead, said: “We are pleased to partner with the EBRD and IFC and their loan is a testament to the quality of Hystead’s portfolio and asset management expertise. We strive to create value for stakeholders, while balancing our impact on the environment and the communities in which we operate; This is evident through our planned commitment to sustainable building management and youth development programs.
Hystead was established by Hyprop Investments Limited, a South African real estate investment trust (REIT) with a strong track record in operating shopping centers with its joint venture partner PDI, a company associated with Louis Norval, non-executive director of Hyprop Investments. Limit.
Phil Bennett, Senior Vice President of the EBRD, said: “We particularly welcome the company’s commitment to providing more training and employment opportunities for young people. Sustainable building management is a complex and interdisciplinary field and learning on the job is crucial for those seeking a career in planning and managing environmentally focused real estate projects. Hystead is a great example of inward investment bringing know-how, creating jobs and boosting the regional economy.
“This is IFC’s third capital markets-focused investment in commercial real estate in Eastern Europe in the last 18 months. This is an exciting time for IFC as we find innovative ways to support the real estate sector,” said Lukas Casey, IFC Head of Manufacturing and Services for Europe, Middle East and North Africa. “We are very pleased to support skills training, retail infrastructure, green buildings, south-south investment and attract commercial capital to the region. »
Supporting job-creating foreign direct investment in Balkan countries is one of the priorities of the EBRD and the IFC.
