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French REIT Klépierre will see its liquidity more than double to EUR 2 bn by end-2012 thanks to a string of disposals and successful bond issues in the past 12 months, CEO Laurent Morel told PropertyEU. ‘We are well on schedule...we do not need to do any significant refinancing until end-2014,’ he said.

The strong growth of Klépierre’s cash pile in the past year follows an accelerated campaign to divest non-core assets and offices. In the past 12 months, the company has sold assets totaling some EUR 700 mln, Morel said. This includes the recent sale of retail parks in Dijon and Mulhouse to Henderson Global Investors for EUR 150 mln. Morel said the disposals had all been realized at or above valuation levels.

In addition, the Paris-listed company has successfully tapped the bond market twice in the past year. In total it has raised EUR 800 mln from a plain-vanilla bond issue (EUR 500 mln) and a private bond placement (EUR 300 mln).

Morel said the company’s strategy had received a welcome boost from the acquisition earlier this year of a 28.7% stake in French retail REIT lift by Simon Property Group. The US retail specialist acquired the stake from BNP Paribas for a total transaction value of around EUR 1.5 bn. The move reduced BNP Paribas’ majority stake to just over 22%.

The deal with Simon has strengthened Klépierre’s shareholder base and provided certainty about its direction, Morel said. ‘Simon was willing to accelerate our plan so we felt vindicated by the number one player in the world.’

In the coming year, Klépierre will continue to deliver its pipeline, in particular extensions of existing shopping malls, Morel added. ‘We will also continue to work hard on new ways to manage our malls and improve their attractiveness.’

In the past 12 months, the French REIT has delivered three major projects including the St Lazare mall in Paris' railway station, the Sentiers de Claye-Souilly extension project in eastern Paris and a new mall in Malmö. Altogether the three new developments will generate an additional EUR 45-50 mln in rental income, Morel said. ‘It has been a very good year for new developments.’

For the full year, Morel expects to lift rental growth by 3-4% on a current basis and by 2-2.5% on a like-for-like basis.

Morel said the company would continue to work on its balance sheet in the coming year. ‘It is part of our strategy to deleverage and concentrate on our core outperforming geographical areas.’

BNP Paribas, which previously owned 50.9% of Klépierre, said it will retain 22.2% of the company's capital after the deal, and plans to remain a significant shareholder in the company. BNP said it is committed to keeping this entire stake for at least one year.

Klépierre is a Paris-based real estate company that focuses on the ownership, management, and development of shopping centres, retail properties and offices across Continental Europe. Its portfolio, valued at EUR 16.4 bn at end-June 2012, includes 265 shopping centres in 13 countries, with 50% of its properties in France and Belgium, 25% in Scandinavia, and the balance in Central and Southern Europe.