Europolis submits EIA docs for Harbour City in Bratislava

Just days after it was revealed that Europolis had been sold to CA Immo, the daily Slovak paper SME  is reporting the developer has submitted documents needed to clear the way for its megaproject, Harbour City, in Bratislava. With the tallest of the 8 buildings planned on the site at 150 meters, you’d never guess there was a recession on. Especially given the Europolis’ goal of beginning construction of the €50m scheme by next March. In all, the scheme will offer 105,000 sqm office space. An additional 9,000 sqm of retail space will also be built, as will (yet) another hotel.

Tesco to issue mortgage bond

Tesco continues to take advantage of the confidence investors have in its cash flow. Along with selling off warehouses it occupies to institutionals, it’s now set to raise €1.1bn (GBP 950m) by creating a mortgage bond backed up by the income of 41 of its stores in the UK. Experts point out this isn’t your standard CMBS structure, because the assets behind the 30-year bond are all owned by a single company. The FT notes this is the fourth time the retailer has tapped the capital markets in this way in the past 18 months.

High-rise projects back in Warsaw

Readers of this blog surely remember when, just before the crisis hit, the property talk in Warsaw was all about how many, and how tall, new office, hotel, and residential towers were going to be. Two years later, not one of them got off the drawing board, really, and the focus has shifted to timing new construction right in order to catch new demand as the market returns. A pair of developers now seem to be betting the high rise days are back.

Yesterday, Echo Investment entered into a preliminary agreement to purchase a centrally located Warsaw plot at the junction of Jana Pawła II and Grzybowska streets, where the Mercure hotel currently stands. The transaction volume was €31m. Echo is going to build a 155-meter tall office tower with 45,000 sqm GLA office space on the plot, currently owned by Accor.

The other high-rise story involves the return of state-owned property management company Dipservice of its pre-crisis plans (on which we reported here). The company wants to go ahead with plans to tear down its current seat in obsolete building on Świętokrzyska Street, directly opposite the Rondo 1 office tower, in order to build a 30,000 sqm office complex consisting of two buildings of 16 and 37 storeys, plus a hotel and conference center. “

“We cannot offer high standards here, and therefore we’re losing out on the rents we could possibly charge in a modern building in such a location,” Dispervice told CIJ when we first spoke to them about their plans in 2007.

CA Immo buys Europolis for €272m

CA Immo has just bumped up its CEE property holdings by agreeing to buy the Europolis portfolio for €272m. From 19%, the group’s CEE holdings have now jumped to 40%, on par with its holdings of German assets. Half of the agreed price is to be paid in January, when the deal is expected to close officially. The rest will be due five years from then. Europolis reported assets of €1.5bn at the end of 2009, with property writedowns of €177m.

Oesterreichische Volksbanken decided to sell its problem-ridden real estate unit after failing to find a strategic partner for the entire group.

Spielberk construction resumes

Construction got underway yesterday at CTP Invest’s Spielberk project in Brno, meaning the delayed third phase, an office and hotel tower should be completed in the first quarter of 2012. Traditional tenants like Lufthansa were on hand, along with a newcomer to the Brno scheme, AVG. At the event, which market the project’s 5th anniversary, the guest list included Dutch ambassador Jan C. Henneman, pictured (left) with CTP director Remon Vos. The two were about to be lifted by crane to a height of 85 meters.

CTP is going ahead with construction on the last phase of the project despite substantial office vacancy in the Czech Republic’s second city. The calculation is apparently that the project, and the location, are strong enough to continue produce take-up.

The Pop Up store phenomenon

Got an empty store in your building? Landlords in New York city are getting a bit of cash flow, and a lot of free marketing, by offering their vacant space short-term. Fascinating article in the New York Times about the Pop Up store phenomenon.

The concept of a “now you see it, now you don’t” store is commonly tied to a holiday theme: the New York beauty store Ricky’s opens more than a dozen Halloween costume shops in September and October. And last winter Toys “R” Us opened 33 Holiday Express locations in the tristate area.

But in the last few years pop-ups have flourished in New York regardless of the holiday calendar. For building owners they are a way to fill vacant space and for sellers they offer a place to gauge the reception to their brand or introduce new products, without a long-term rental commitment.

Orco: Permit still to be confirmed

The Orco reaction to yesterday’s legal setback is out. An excerpt:

“While we were hoping for a final decision confirming the building permit today, we are reassured because the NSA has confirmed the legality of so many essential elements of Zlota 44’s building permit. The case records will now be delivered to the Governor of the Mazowieckie Voivodeship, who will re-examine the decision of the President of the City of Warsaw about the building permit.” – commented Krzysztof Godleś, Orco Development Manager for Poland.

More bother for Orco over Złota 44

Our sources in the courtroom claim that Poland’s Supreme Administrative Court has apparently just ruled against Orco’s request to restore the construction permit for the Złota 44 skyscraper in downtown Warsaw on procedural grounds.

Both the zoning and construction permits were revoked last year by a lower court, following action from people living in a neighboring building who claimed that the permit for Złota 44 had been issued counter to regulations. Then in March this year, upon Orco’s appeal, the court ruled that the zoning permit for the building was fine.

So, is this two steps forward, one step back? We’re awaiting a reaction from Orco, which was on a run of good news, but clearly this could damage hopes of getting the project done by 2012. It currently stands unfinished, with just 17 storeys done. As Orco CEO JF Ott pointed out last week in his blog, the city of Warsaw has little to gain from such a sight.

For that matter, neither does Orco.

Ghelamco gets BREEAM for Trinity Park III

Not that long ago, environmental ceritification for property was more of a curiosity and a subject that developers liked to discuss,  but often dismissed. These days, news about projects going for systems like BREEAM or LEED has become almost common.

Finally, Poland has gotten its first full-on green certified building: Ghelamco has had its Trinity Park III office building in Warsaw BREEAM-certified. The certification process was handled by Grontmij Polska.

Trinity Park III is a 32,000 sqm office building in the Warsaw office hub district of Mokotów. The developer sold it to SEB’s ImmoPortfolio Target Return Fund in March 2010, for €93m.

Czechs to push for Galileo

The Czech Republic is expected to make its case today for the future home of the Global Navigation Satellite System (GNSS) to be in Prague. Better known as Galileo, the location of the final headquarters has been up for grabs since back in 2006, when it was decided that one of the new member countries should get it. Since then, it’s all gone very quiet. No doubt developers would welcome a tenant with that kind of covenant, so they’ll be rooting for a decision to finally be taken.

Polish reforms needed

The rest of Europe has spent the past few weeks searching for ways to cut spending and reform the public sector, so it’s only fair that Poland’s turn may have come. The country’s robust economy has continued to amaze analysts, but the ratings agencies, having blown it by pretending not to see the credit crisis, are in more critical mood these days. The Polish head of Fitch has said reform measures are needed, soon, if the country wants to keep its credit rating safe.

“For five years we’ve been saying that public finances need a reform,” the daily Rzeczpospolita quoted Fitch’s Piotr Kowalski as saying. “It’s a burning issue now.”

Fitch rates Poland A- with a stable outlook.

“If there are no reforms which will improve public finance’s situation by 2012, the negative pressure on Poland’s rating will be huge,” he added.

“For five years we’ve been saying that public finances need a reform,” the daily Rzeczpospolita quoted Fitch’s Piotr Kowalski as saying. “It’s a burning issue now.”
Fitch rates Poland A- with a stable outlook.
“If there are no reforms which will improve public finance’s situation by 2012, the negative pressure on Poland’s rating will be huge,” he added.

Engel East Europe shares suspended on AIM

Does anyone know anything more about this rather cryptic headline on the Wall Street Journal? “Engel East Europe Nv Statement Re. Suspension”.

Last we heard, the developer was selling off its stake in the Gym project in Budapest for €750,000, for a book value loss of €1.4m. But we can’t find a trading prices for the stocks past last Friday morning and would welcome any explainer comments or emails, anonymous or otherwise.

Update: Rules are rules. No annual statement? No trading.

21 June 2010 – Engel East Europe N.V. (‘Engel’ or ‘the Company’), the AIM-listed Central and Eastern European property developer (EEE:L), today announces that, as a result of its continuing weak financial condition, the Company’s annual accounts for the year ended 31 December 2009 cannot yet be finalised and will therefore not be published on or before 30 June 2010. Accordingly, the Company confirms that it will not be able to comply with Rule 19 of the AIM Rules for Companies requiring an AIM company to send its annual accounts to shareholders not later than six months after the end of the financial year to which they relate and as a result its shares will be immediately suspended from trading on AIM.

The audited report and accounts will be published in due course at which point the Company will reapply for its shares to begin trading on AIM again.

21 June 2010 – Engel East Europe N.V. (‘Engel’ or ‘the Company’), the AIM-listed Central and Eastern European property developer (EEE:L), today announces that, as a result of its continuing weak financial condition, the Company’s annual accounts for the year ended 31 December 2009 cannot yet be finalised and will therefore not be published on or before 30 June 2010. Accordingly, the Company confirms that it will not be able to comply with Rule 19 of the AIM Rules for Companies requiring an AIM company to send its annual accounts to shareholders not later than six months after the end of the financial year to which they relate and as a result its shares will be immediately suspended from trading on AIM.
The audited report and accounts will be published in due course at which point the Company will reapply for its shares to begin trading on AIM again.