German property fund CGI has bought the Victoria Square shopping centre, which is under construction in Belfast, for €430 million.
The company, which is an arm of Commerzbank, said the investment was made by its HausInvest Europa fund and was the firm's first in Northern Ireland.
Development work on the site is being undertaken by the Dutch firm AM and construction should be completed by 2007. The anchor tenant for the shopping centre will be the House of Fraser, which has signed a 25-year lease.
The development has 75,000 square metres of rental space and is located in the heart of Belfast city centre. It will also include leisure facilities and residential accommodation.
CGI said the yield on the development would be 6 per cent. "The cautious \ approval practice in Belfast has led to an undersupply of modern retail properties in comparison to other regions in the United Kingdom," said Mr Arnold de Haan, CGI managing director.
Since the start of the 1990s, Northern Ireland has had an average annual economic growth rate of 2 per cent, which is higher than Britain as a whole, he said.
The North also has lower labour costs than the European average and its economy is forecast to grow faster than the EU average, he added. AM and CGI have an established relationship in developing several joint investment projects in Portugal and Spain.
