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Disposal of Castellana's portfolio of retail parks
VUKILE PROPERTY FUND LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2002/027194/06)
JSE share code: VKE NSX share code: VKN
Bond company code: VKEI
(Granted REIT status with the JSE)
("Vukile" or the "Company")
DISPOSAL OF CASTELLANA'S PORTFOLIO OF RETAIL PARKS
1. Introduction
Shareholders are advised that Vukile's 99.7% held subsidiary, Castellana Properties SOCIMI, S.A. ("Castellana"),
has concluded a share sale and purchase agreement (the "Agreement") with Ferrel SPV 2025, S.L.U. (the
"Purchaser"), pursuant to which Castellana will dispose of its portfolio of retail parks located across Spain (the
"Portfolio" or the "Properties") (the "Disposal"). Full details of the Properties are set out in paragraph 6 below. The
Purchaser is ultimately owned by funds managed by affiliates of Ares Management Corporation, a publicly traded
company listed on the New York Stock Exchange and a leading global alternative investment manager.
Castellana is the sole shareholder of nine companies (the "Disposal Companies") which own the various Properties
comprising the Portfolio. In terms of the Agreement, Castellana will sell the entire issued share capital of each of the
Disposal Companies (the "Disposal Shares") to the Purchaser with effect from the closing date of the Disposal, as
detailed in paragraph 3 below.
2. Rationale for the Disposal and use of proceeds
Castellana has successfully grown the Portfolio since its acquisition in 2017, increasing the net operating income by
c. EUR 3.7 million (or 26%) over the timeframe. The Castellana team has implemented many accretive asset
management initiatives in the Portfolio, and now believes that given the strong demand for retail parks in Spain, it is
the opportune time to dispose of the Portfolio and re-allocate the capital into higher growth opportunities in shopping
centres, further leveraging its strong track record of value-add investing in Spanish and Portuguese shopping centres
with high growth potential.
While new shopping centre development in Spain remains highly constrained, retail park development is increasing
driven by strong investor demand. This sustained appetite is placing upward pressure on retail park pricing. In
contrast, the limited availability of shopping centres supports their relative value, meaning that pricing for shopping
centres remains attractive and offers compelling growth potential for local, on-the-ground retail specialists such as
Castellana.
The Portfolio is being sold in line with Castellana's most recent external valuations. The Disposal is value-accretive
for Castellana, as it crystallises gains from the Properties' revaluation achieved through active asset management and
strong operational performance. Overall, the revaluation of net asset value between acquisition and disposal
represents a net gain of 13% for Castellana, showcasing Castellana's expertise in creating value through active asset
management and value-add projects, especially over a very challenging market environment since 2017 which has
included negative market factors, notably a sharp rise in interest rates, Covid and the Russia-Ukraine war.
3. Terms of the Disposal and Closing
The effective date of the Disposal is expected to be 1 April 2026 (the "Closing Date"). The Disposal Shares (and
indirectly, the Properties) will be sold and transferred to the Purchaser on the Closing Date. The purchase
consideration payable by the Purchaser for the Disposal Shares is EUR 279 000 000 (the "Purchase
Consideration"), payable in cash on the Closing Date. The Purchase Consideration has been calculated based on the
financial statements of the Disposal Companies as at 31 October 2025 and may ultimately be adjusted based on the
financial statements of the Disposal Companies as at the Closing Date. It is not expected that there will be a material
adjustment to the Purchase Consideration at the Closing Date. Given the closing date of 1 April 2026, the disposal
will have no impact on Vukile's guidance for the year ending 31 March 2026, as announced on 26 November 2025.
The Disposal yield is 7.1% on the Purchase Consideration.
During the interim period from the conclusion of the agreement until the Closing Date, Castellana will continue to
manage the Disposal Companies and the Portfolio in the ordinary course of business and in accordance with market
standards and will ensure, to the extent possible, that there are no material adverse changes to the Disposal Companies
or the Portfolio.
The Agreement includes market-standard warranties, indemnities and undertakings for a transaction of this nature.
Completion of the Disposal is not subject to any conditions precedent.
4. Recycling of Disposal proceeds
The proceeds from the Disposal, together with the existing cash resources, most specifically the funds raised in
October 2025, will be deployed into accretive, value-add investments already in the pipeline and all at an advanced
stage. As such, it is expected that the asset-rotation strategy, highlighted by the sale of the Properties, and imminent
redeployment into higher growth, high quality shopping centres, will be accretive to Castellana and Vukile.
5. Conclusion of asset management agreement
In addition to the Agreement, and in recognition of Castellana's expertise in the Spanish market, Castellana and the
Purchaser have concluded an asset and property management agreement (the "Management Agreement") in terms
of which Castellana will provide asset and property management services in relation to the Portfolio for a period of
5 years. Castellana will receive market-standard fees for these services. The Management Agreement includes terms
and conditions which are standard for an agreement of this nature.
6. Property specific information
Details of the Properties are set out in the table below:
Value
Purchase attributed to
Weighted Consideration each Property
average rental attributable to as at 30
Property Geographical GLA per m2 each Property September 2025
name location Sector (m2) (EUR/m2/month) (EUR) (EUR)
Parque Oviedo, Spain Retail 16 090 14.7 40 750 639 39 550 000
Principado
Granaita Granada, Retail 55 917 11.3 89 930 310 97 220 000
Spain
Parque Oeste Madrid, Spain Retail 13 600 19.1 44 940 687 46 310 000
La Heredad Badajoz, Retail 13 447 9.9 21 035 182 22 040 000
Spain
La Serena Badajoz, Retail 12 405 10.0 19 396 016 18 450 000
Spain
Ciudad del Castellon, Retail 19 300 2.4 7 080 435 7 280 000
Transporte Spain
Marismas del Huelva, Spain Retail 21 120 8.0 28 448 000 29 480 000
Polvorin
Motril Granada, Retail 9 165 7.0 10 207 756 9 660 000
Spain
Pinatar Park Murcia, Spain Retail 13 261 8.3 17 210 975 16 180 000
TOTAL 174 305 10.2 279 000 000 286 170 000
The Properties were valued in accordance with Royal Institution of Chartered Surveyors standards by Colliers
International, an independent external property valuer.
7. Financial information
The net asset value and accounting loss after tax attributable to the Portfolio are EUR 161 245 154 and
EUR 2 327 395 respectively. This information has been extracted from Castellana's unaudited interim financial
statements for the six months ended 30 September 2025, which were prepared in terms of International Financial
Reporting Standards. The accounting loss is reflected after a fair value adjustment to bring the book value in line
with September 2025 valuations. The Purchase Consideration represents a c.2.5% discount to the 30 September 2025
external valuations.
8. Categorisation
The Disposal is classified as a category 2 disposal in terms of the JSE Listings Requirements and accordingly does
not require Vukile shareholder approval.
9. Investor call
Shareholders and noteholders are advised that Vukile will host an investor call on Tuesday, 3 February 2026, at
11:00, where Vukile management will discuss the Disposal and other strategic initiatives implemented by the
Company.
The investor call can be accessed at the following link:
https://teams.microsoft.com/meet/35419449912533?p=p1MKQBmGMt4Kb1KYpy
28 January 2026
JSE sponsor NSX sponsor
Java Capital IJG Securities (Pty) Ltd
Date: 28-01-2026 09:00:00
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