Sparkassen Immo announced today the sale of 75% stake in Steffl department store in Vienna, Austria. The price for the transaction has not been disclosed. This (2 900 CZK, -0,99%) provides approximately 13,900 sqm of retail and office space. In addition the company announced preliminary agreement for the sale of Herzmansky department store also in Vienna Austria on one of the most frequent streets there – Mariahilfer Strasse. The sale is scheduled to be completed before the end of 2007. This (2 900 CZK, -0,99%) provides approximately 18,200 sqm of retail and office space.
Our view: We see the disposal of assets in mature markets like Austria positively as the prime yields compressed there to 5.5% and we don't see any further compression there to happen. Thus the strategy of the company to use proceeds for development pipeline in CEE and especially SEE region is good and we approve this approach. Although the price of the two transactions has not been disclosed we believe that based on the prime locations of both properties, market value of Steffl could be around EUR 80m and Herzmansky of EUR 65m for 100% stakes.