Weeks after agreeing to sell its Spanish retail parks for €279 million ($334 million), South African shopping mall giant Vukile Property Fund is moving into Spain’s shopping centre market. The Johannesburg-listed real estate investment trust will acquire Berceo Shopping Centre in northern Spain in a €108 million ($127.6 million) deal, expanding its holdings in income-generating retail assets outside South Africa.
The acquisition will be made through Vukile’s 99.7 percent-owned Spanish subsidiary, Castellana Properties SOCIMI SA, which has signed a share purchase agreement to buy Barings Core Logrono SLU, the owner of the Berceo centre in Logroño, La Rioja. The seller is Barings Core Spain Socimi SAU, a publicly traded property fund listed on Euronext Paris.
The transaction is expected to close on Jan. 30, 2026, with payment to be made in cash on the closing date. Vukile said the price may be adjusted based on closing financial statements, although no material change is anticipated, and the deal is not subject to conditions precedent.
Berceo Logroño mall anchors Rioja retail
Opened in 2003, Berceo is a leading regional shopping centre serving Logroño and surrounding provinces. The property has a total gross lettable area of 49,416 square meters, of which Castellana will own 34,416 square meters spread across 90 stores. The remaining space is owned by Olimpo Real Estate SOCIMI and is occupied by a Carrefour hypermarket. Key tenants include YelmoCinemas, Zara, Primark and Media Markt.
The center serves an effective catchment of up to 365,000 people and faces no competing large-format retail destination within a 100-kilometer radius. Logroño, the largest city in La Rioja, is the region’s main commercial hub and benefits from purchasing power above Spain’s national average. La Rioja has a population of over 324,000, GDP per capita of $38,784 and an unemployment rate of 8.8% as of the first quarter of 2025, below the national level.
Value-led expansion in Spanish retail
Vukile Chief Executive Officer Laurence Rapp said the transaction reflects a deliberate approach to asset management. “At Vukile, we believe that knowing which assets to sell, and when to sell them, is just as important as knowing where and when to invest,” Rapp said. He added that the company sees better value in Spanish shopping centres, where new development remains limited, supporting occupancy and pricing for established assets. Proceeds from the retail parks sale, alongside cash raised in Vukile’s October 2025 capital raise, will be redeployed into fully funded Iberian acquisitions, with Berceo marking the first step.
Operationally, the center has shown a solid recovery since the pandemic. Footfall reached 6.3 million visitors in calendar year 2025, while tenant sales totaled €101 million ($120 million), translating into sales density of €3,100 ($3,662) per square meter. Average rentals are about €20 ($23.6) per square meter per month, which Vukile said leaves room for growth. This reflects a net operating income entry yield of about 7%, rising to a cash-on-cash yield of 8.6% before withholding tax when senior debt costs and transaction expenses are included.
Vukile expands Spain portfolio with debt-funded deal
Vukile, South Africa’s third-largest REIT, holds R54 billion ($3.37 billion) in property assets, with about two-thirds of its portfolio and net property income generated in Spain and Portugal through Castellana. The Berceo purchase adds scale in northern Spain and offers scope for further leasing improvements, particularly in food, beverage and leisure, as Castellana continues to refine its Iberian portfolio.
The deal will be funded using existing cash and €50 million of local debt, resulting in a loan-to-value ratio of about 46%. Colliers International valued the property at €110.24 million ($130.2 million) as of Dec. 31, 2025. Forecasts prepared by Vukile show rental and recovery income of €1.73 million ($2.04 million) and net profit after tax of €757,000 ($894,400) for the two months to March 31, 2026. For the year to March 31, 2027, rental and recovery income is projected at €10.65 million ($12.6 million), with net profit after tax of €4.78 million ($5.64 million). About 93.7% of that income is already contracted.
