Morgan Stanley Real Estate Investing and the Hines CalPERS Russia Long Term Hold Fund Link Up on Metropolis Mall in Moscow
(MOSCOW) - A real estate fund managed by Morgan Stanley Real Estate Investing (MSREI) today announced the sale of a stake in the Metropolis Shopping and Entertainment Mall, a 2.2 million-square-foot (205,000-square-meter) shopping center in Moscow, to the Hines CalPERS Russia Long Term Hold Fund (HCRLTH). Terms of the transaction were not disclosed.
The MSREI fund acquired the Metropolis Mall earlier this year in a transaction that still ranks as the largest-ever in the Russian commercial real estate market. Metropolis is one of the most visited shopping centres in Moscow with approximately 55,000 customers per day. The complex is fully leased and has a waiting list for retailers wanting to rent space.
“We are delighted that CalPERS and Hines are investing alongside Morgan Stanley Real Estate Investing in the Metropolis Mall in Moscow,” said Thierry Vanden Hende, managing director at MSREI. “MSREI has built a strong retail platform in Russia through the acquisitions of Metropolis in Moscow and Galeria in St. Petersburg, and we look forward to working with Hines and CalPERS to deliver the operational leverage and strategic benefits associated with owning two prime shopping centres in Russia.”
Lee Timmins, senior managing director and country head for Hines Russia since 1992, added, “The consumer is the engine of Russian economic growth, and we are excited about the opportunity to increase our exposure to this sector of the economy, especially with a leading partner like MSREI.”
“This investment is part of the implementation of our 2011 Strategic Plan, which outlines our intent to buy stabilized assets in major cities in emerging market countries. The Metropolis Mall is a good addition to our portfolio,” commented CalPERS’ Senior Investment Officer for Real Assets Ted Eliopoulos.
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Metropolis opened in 2009 and provides 882,000 square feet (82,000 square meters) of fully enclosed retail accommodation and 2,900 parking spaces. It is widely recognized as Russia's premier full-price retail development with a favorable location in the northwest part of Moscow, along the Leningradskiy highway and next to the metro station Voykovskaya. The shopping centre is part of the institutional quality mixed-use complex Metropolis with 3.3 million square feet (311,000 square meters) of gross built area which, apart from the shopping centre, includes three office buildings with a total GLA of approximately 860,000 square feet (80,000 square meters).
Metropolis is one of the most visited shopping centers in Moscow with approximately 55,000 customers per day in 2012. Major tenants include food hypermarket Karusel and department store Stockmann, along with a large number of international retailers including Michael Kors, H&M, GAP, River Island, New Look, DKNY, Bebe, Jaeger, Uterque, Imaginarium and Zara. The center also has a bowling alley and a multi-screen cinema operated by Cinema Park Deluxe.
Among the awards received by Metropolis are: the “Best Mixed-use Complex” award in the Commercial Real Estate Awards, Moscow, 2009; “Best new development category extra-large” award in the Russian Council of Shopping Centres; and “Best Shopping Centre of the Year” award in the FIABCI “Prix d’excellence” Awards, 2010.
About Morgan Stanley Real Estate Investing
Morgan Stanley Real Estate Investing (MSREI) is the global real estate investment management arm of Morgan Stanley. Established in the early 1990s, MSREI has been one of the most active real estate investors for two decades, acquiring over $184 billion of assets in 36 countries. MSREI leverages the expertise, relationships and franchise of Morgan Stanley with dedicated real estate investing professionals located in 15 offices around the world providing acquisition, finance and asset management services. MSREI manages opportunistic and core investment strategies on behalf of its clients, including some of the largest pension funds, sovereign wealth funds and high net worth investors worldwide. For more information about Morgan Stanley Real Estate Investing, please visit www.morganstanley.com/realestate.
Morgan Stanley (NYSE: MS) is a leading global financial services firm providing a wide range of investment banking, securities, investment management and wealth management services. The Firm's employees serve clients worldwide including corporations, governments, institutions and individuals from more than 1,200 offices in 43 countries. For further information about Morgan Stanley, please visit www.morganstanley.com.
About Hines CalPERS Russia Long Term Hold Fund
Formed in March 2013, with initial equity commitments of $493 million, the Hines CalPERS Russia Long Term Hold Fund is a joint venture between CalPERS and Hines. The fund, managed by Hines, has a strategy to acquire Class A logistics and retail assets in Russia for long term hold.