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"A Dutch retail property fund continues to invest heavily in Istanbul, proving it has a lot of faith in Istanbul's status as a rapidly emerging city. The latest purchase is half of a building next to the Galatasaray Lycee (high school) on Istiklal Avenue for 29.5 million euros, the fund's seventh purchase in Beyoğlu district.
"The property will be renovated shortly" and after refurbishment costs of 3.5 million euros, its gross rental income is expected to be around 2.5 million euros per year, according to a press statement. The figure represents a net initial yield of 7.3 percent.
Vastned has now purchased some 90 million euros worth of prime retail real estate in Turkey, including an Istanbul portfolio, focussed on high street shops in and around İstiklal, worth 80 million euros. Its tenants include: Turkcell, Topshop, Penti and Abercrombie & Fitch.
“With this transaction we are well on our way to achieve our strategic goal of developing Turkey into a fifth core market. Major European and American retailers are queuing up to install their flagships in the heart of Istanbul,” the company statement quoted Reinier van Gerrevink, CEO of VastNed Retail, as saying.
Until recently Vastned's 2 billion euros portfolio was almost all in eurozone countries, the fact that they have decided to invest so heavily in Turkey is a huge testament to the potential for growth in the Turkish retail sector, and the economy as a whole. Retail growth equals job creation, equals increasing employment, increasing affluence and increasing demand in the residential sector of the Turkish property market.
