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Citadele and Luminor banks have agreed on a syndicated loan of 34 million Euro to finance the construction of the Saga Lifestyle Shopping Centre. The shopping centre project initiated by the commercial real estate developer, VPH, has total financing of 68 million Euro.
Total financing from the banks is 34 million Euro, 19 million Euro of which is from Luminor, while 15 million is from Citadele. The new lifestyle shopping centre will be located in Stopiņi county next to the IKEA superstore and will cover a total of 56,000 m2. The concept of the centre anticipates an exciting destination which unites shopping with leisure, sport and offices.
“With Saga, VPH continues its cooperation with IKEA‘s franchise holders, which started with development of Nordika shopping center next to IKEA in Vilnius. Saga will be one and half times larger than Nordika, and while it will have a number of the same trusted tenants as Nordika, Saga proudly will introduce totally new brand names into the Latvian market. We are excited to cooperate with Citadele and Luminor, which have been our long and trusted partners in financing our developments. This time we also had a unique experience of issuing bonds to co-finance Saga. Here, we were advised by Confidentus, which was the lead arranger of 11.4 million Eur bond issue,” highlights Barry Nabuurs, Partner and Director of VPH real estate development.
“We see a new trend that alternative sources of financing are more often required to develop real estate and other projects. Bonds are one of the alternatives which could be used to finance various types of businesses,” explains Kristupas Kukarskas, Partner of the investment banking boutique Confidentus.
“For many years, Luminor has collaborated with VPH both in Latvia and Lithuania, and we have already financed their completed projects such as the Mežciems shopping centre. We are pleased to make our contribution, supporting this project with the majority of its financing -19 million Euro - to help develop the city’s environment with a modern, next-generation shopping centre. This ambitious project will promote the improvement and development of the suburbs, offering new opportunities both for local residents and the council, and for the development of new businesses and everyday services,” emphasizes Ilze Zoltnere, Head of the Corporate Department at Luminor.
“Citadele’s aim is to give Latvian businesses the necessary support to develop and grow. We are participating in the co-financing of the Saga shopping centre project because we believe in our proven business partners and the concept of the project itself, which is based on demand from tenants who have already reserved a retail space. The project will offer more opportunities for the inhabitants of Stopiņi county, Riga and the surrounding area, providing both leisure options and office space,” explains Genrihs Peršteins, Head of Corporate Client Services at Citadele.