Monthly Archives: January 2011

Merger announced between ProLogis and AMB

Details as they come in, but for now, just know that ProLogis is merging with AMB Property Corporation. The deal will create an industrial giant that owns and manages $46bn worth of property around the world. While it’s being billed as a merger of equals, ProLogis has 40 million sqm, compared AMB’s 15 million sqm. The transaction is expected to close in the second quarter 2011, though a number of hurdles have to be cleared before that actually happens.

Khaldey sells AFI Development stake

AFI Development’s co-founder and general director Alexander Khaldey has sold his 9.7% stake in the company to the developer’s largest shareholder, Africa Israeli Investments. The deal, which will cost Africa Israeli Investments USD 129m, will give it a 64% stake in the developer.

“This agreement confirms the long term commitment of Africa Israel Investments to AFI Development,” said Izzy Cohen, CEO of Africa Israel Investments. “We continue to see major growth opportunities in the Russian real estate sector and Moscow in particular, which AFI Development is uniquely positioned to realize.”

Invesco picks up Crown Square

Ghelamco has done another piece of business with the sale of its office property Crown Square to Invesco Real Estate, which will put it in one of its pan-European funds. Invesco says it paid €63.7m for the asset, a new 16 storey office building whose tenants include Nike and Oracle. Crown Square has a “very good” BREEAM certificate. The two companies have history, as Invesco purchased Zaulek Piekna from it back in 2005.

Bombing at Domodedovo airport

Not good news. First reports are of 31 killed at Moscow’s largest airport in an apparent suicide bombing.

Immorent becomes Erste Group Immorent

We’ll be finding out more about what the impact of this move will be over the next couple days, but for now, people around Prague will be interested to know that Immorent, part of the Erste Group, is now called Erste Group Immorent. It’s not just a name-change, however.

The vision of Erste Group Immorent is to create a logical chain of continual services in the real-estate field and provide said services under one name. Kamil Kosman the Real Estate Business Managing Director of Česká spořitelna, and Tomáš Velemínský the director and executive head of Erste Group Immorent CR s.r.o. were appointed to the top management of Erste Group Immorent in the Czech Republic.
“For corporate clients of Ceska Sporitelna the creation of Erste Group Immorent means access to more complex services in real-estate financing. Beyond the standard frame of loans we will also be able to offer real-estate leasing under one name and therefore we will be able to better fulfill the individual needs of our clients,” said Kamil Kosman, Real Estate Business Managing Director of Česká spořitelna.

Prague’s Congress Center (still) drowning in debt

Back in July 2009, we noted that Prague’s Congress Center was up to its ears in debt. Incredibly enough, after it again started looking like bankruptcy in 2010 when KCP didn’t know how it would pay the coupon on its bonds, the wheels of change seemed to start churning: the rather rational decision was taken to hold a tender to find a strategic partner for the collosus. Of course, any time such pragmatic, sensible decisions are taken, you should expect to get slapped back into reality: the big, painful decisions are only taken once its too late to make the rational, less painful ones.

Still, it was easy to forget that rule when Penta and the Zatisi catering group won the tender, and it began to look as if things were finally moving forward.

They’re not. Finance Minister Miroslav Kalousek said back in November that something about the deal “stinks” and that he’d have to investigate it. (Kalousek himself knows a bit about such accusations…) No word since on if that’s happened, or what the outcome was.

Which brings us to the point, which is that real chaos appears to be breaking out: KCP has to pay that pesky €3m coupon on its bonds again (guaranteed by the Czech state) by April 9. Unfortunately it only has CZK 7m in its accounts.

KCP sent a letter to the city of Prague and to the Czech government suggesting they get cracking with those negotiations with Penta/Zatisi. At the same time (yesterday), KCP’s  chairman of the board Milan Richter, announced his resignation. Richter was brought on as a crisis manager, and now claims it’s “job done”.

Read into that what you will, but this does not sound like the stuff happy endings are spun from. No — these are the type of noises made before tax payers are asked to pay the bill. Let’s hope it’s a bluff.

Zlota 44 update

Orco CEO JF Ott reports on his blog that a new crane is on site at Zlota 44, the developer’s flagship project in Warsaw. All the legal hurdles appear to have been swept aside, so people are now just waiting to see floors get added to the highrise. While you’re there, his previous blog entry is worth a read, as it sheds light on the state of the relationship with Croata’s privatization fund.