Morgan Stanley Real Estate Investing (MSREI) has purchased the Metropolis Mall in Moscow, Russia, for around $1.2 billion. This is reportedly the largest real estate commercial deal of Russia till date.
According to Forbes, MSREI has not declared the price of the acquisition. However, experts estimate the deal to be worth $1.1 billion to $1.2 billion.
Metropolis Mall was developed by major real estate development firm, Capital Group, which opened in 2009. It is one of the largest and glossiest malls of Moscow and comprises of around 250 retail stores and restaurants. Spread across an area of 82,000 square meters, the mall provides for 2900 parking spaces. It also offers a bowling alley and a multiplex cinema that runs under major movie theater chain, Cinema Park Deluxe.
The location of the mall is also an added advantage as it sits along the Leningradskiy highway, just adjacent to the Voykovskaya metro station. According to the mall records, it received around 55,000 customers per day in 2012. The mall is a fully leased space and has a queue of retailers wanting to set up shop in the building.
The mall has retail stores of major international brands like H&M, Zara, Uterque, Michael Kors, and River Island.
"The acquisition is consistent with our strategy of investing in high quality assets in Russia, a market that should continue to benefit from strong growth in consumer demand. Together with our previous investment in the Galeria Mall in St Petersburg, we believe the acquisition of Metropolis will deliver operational synergies and strategic benefits associated with owning two prime shopping centers in Russia." Brian Niles, head of MSREI EMEA, said in a statement.
Though malls are popular with Russians, consumer spending in the commercial spaces went down to 3.5 percent from the recorded 7.3 percent in the first quarter of 2012. The economy is moving at a very sluggish pace in the country and the investment might not be very successful for Morgan Stanley, reports Financial Times.
