Elbit Imaging Announces the Completion of the Sale of Belgrade Plaza (VISNJICKA) by its Subsidiary, Plaza Centers
TEL AVIV, ISRAEL / ACCESSWIRE / March 2, 2017 / Elbit Imaging Ltd. ("EI" or the "Company") (TASE, NASDAQ: EMITF) announced today, in further to its announcements dated on November 3, 2016 and January 26, 2017 that Plaza Centers N.V. ("Plaza") (PLAZ.L), an indirect subsidiary (45%) of the Company, has successfully completed the sale of Belgrade Plaza shopping and entertainment center, by one of its subsidiaries (the "SPV"), to a subsidiary of BIG Shopping Centers Ltd. (the "Purchaser").
Belgrade Plaza is currently the largest development underway in Serbia. The shopping center, which is currently over 90% pre-let, is on schedule to open in April 2017 and Plaza will remain responsible for the development and leasing of the asset until the opening. Plaza's subsidiary shall pay all related development costs until the opening through a line of credit from a financing bank which was previously agreed for the development of Belgrade Plaza to a maximum amount of Euro 42.5 million.
Following the successful sale, Plaza has now received an initial advance payment of approximately Euro 31.5 million from the Purchaser for the sale of 100% of the SPV. This will be followed by further payments during the first 12 months of operation, which are subject to certain operational targets and milestones being met. BIG Shopping Centers Ltd. has provided a guarantee to secure these future payments.
As previously stated, the final agreed value of Belgrade Plaza, which will comprise approximately 32,300 sqm of GLA, will be calculated based on a general cap rate of 8.25% on the sustainable NOI after 12 months of operation, which Plaza estimates will be approximately Euro 7.2-7.5 million per annum. Parts of the NOI will be re-examined again after 24 months and 36 months of operation, which may lead to an upward adjustment of the final purchase price.
At least 75% of the net proceeds received from the disposal will be distributed to Plaza's bondholders by or before March 31, 2017, and further distributions will be made following receipt of any future additional payments, in line with Plaza's stated amended restructuring Plan.
