TPS Real Estate plans to increase the portfolio of projects to 2m square meters by the end of 2016, said First Vice President of TPS Real Estate Alexei Chinaliev at the session devoted to the financing of development projects in a volatile market, as part of the business program of the real estate tradeshow REX-2014 in Moscow.
“By the end of 2016 the company plans to manage 13 shopping centers with aggregate floor area nearing 2m square meters. We intend to annually expand our portfolio at least by one or two new projects, 120-140 thou square meters each,” noted Mr. Chinaliev in his address. “In this case total rentable space owned by the company will come to about 860 thou sq m.”
Commenting on the current volatility in Russian economy, Mr. Chinaliev pointed out that the retail market participants have to work under challenging circumstances and yet this is a far cry of the situation in 2008-09. Although investments in Russian commercial real estate will sag considerably due to the wait-and-see stance of investors, the market at large will further develop and the construction of new projects will continue. Moreover, companies possessing liquidity and the opportunity to raise loaned funds will gain extra advantages for expansion.
“As regards our company, until now TPS Real Estate has carried out development projects on equity funds, but this year we are going to increase the volumes of investments at the expense of loaned capital,” said the company’s Vice President. “At the present time we are closing a number of deals on comfortable terms and during the next five years we intend to increase the financial leverage to $2 billion.”