Retail properties

Morgan Stanley pays US$1.2b for Russian mall in largest retail purchase

PUBLISHED : Wednesday, 27 February, 2013, 12:00am
UPDATED : Wednesday, 27 February, 2013, 5:04am

Morgan Stanley said it bought a Moscow shopping mall in the biggest acquisition of a Russian retail property.

A fund managed by the bank acquired Metropolis Shopping and Entertainment Mall from Capital Partners, the Kazakh developer that opened the property in 2009, the bank said.

Morgan Stanley paid about US$1.2 billion for the mall, two people familiar with the transaction said.

The deal follows Morgan Stanley Real Estate Fund VII's US$1.1 billion purchase of the Galeria mall in St Petersburg last year.

That transaction contributed to an annual 4 per cent rise in Russian commercial real estate sales during the first nine months of last year, according to data compiled by Real Capital Analytics.

"The acquisition of Metropolis will deliver operational synergies and strategic benefits associated with owning two prime shopping centres in Russia," said Morgan Stanley, which described the purchase as the largest ever in the country's commercial real estate market.

The Metropolis mall in northwest Moscow, near the main highway to the city's airport, has 82,000 square metres of retail space and 2,900 parking spaces. The shopping centre attracted about 55,000 visitors a day last year, Morgan Stanley said.

Capital Partners was advised by Jones Lang LaSalle.