Arricano Real Estate plc

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Arricano Real Estate plcFormerly| Arricano Trading Ltd.

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Company type| Public limited company
Industry| Real estate development, retail
Founded| 2005
Headquarters| Kyiv, Ukraine
Products| Commercial real estate
Website| www.arricano.com

Arricano Real Estate plc is a public limited company operating in the field of commercial real estate, one of the big developers and shopping centre network operators in Ukraine. The company deals with full cycle of retail real estate development, from purchase of land property and construction to shopping mall operation.

Arricano Real Estate plc is a company that has European investments, European standards and approaches to business management. The company is managed by the team of European and Ukrainian top-managers. The activity of Arricano Real Estate plc is controlled by the board of directors, which consists of three independent non-executive, one executive and two non-executive directors. The directors report to the shareholders regarding the issues of the group's performance, its achievements and long-term plans.[1][2]

## History

[edit]

Arricano Real Estate plc was established on 31 January 2008, as a limited liability company Arricano Trading Limited. The current company name was adopted after its reorganization on 12 September 2012.

In 2005, a majority stakeholder of Arricano Real Estate plc – Retail Real Estate S.A. (Luxembourg) – started operating at Ukrainian commercial real estate market through its branch companies. Phase one of Kyiv shopping and entertainment complex Sky Mall in 2007. In order to provide for further development of the projects, financing from JSC UkrSibbank was obtained amounting to US$13 million.

The next remarkable event took place in 2008, when on 11 October, Sun Gallery shopping centre having gross leasable area (GLA) of 35,000 square metres (380,000 sq ft) was opened in Kryvyi Rih.[3]

The same year, Arricano entered into credit facility agreement with European Bank for Reconstruction and Development (EBRD) in Ukraine under which conditions it was possible to obtain a maximal amount of financing of US$139,307,000.

Branch companies of Retail Real Estate S.A., are consolidated into a group of companies headed by Arricano as a holding company for the purpose of further construction of professional shopping malls and management of commercial real estate in Ukraine.

In 2010, the opening of phase two of one of the biggest shopping centres in Kyiv, Sky Mall, with total area (GBA) amounting to 88,000 square metres (950,000 sq ft), including the leasable area (GLA) of 68,000 square metres (730,000 sq ft), took place.[4]

Dragon-Ukrainian Properties & Development plc (DUPD) investment fund purchased 35% of shares of Arricano Trading Limited, investing the amount totalling to $30 million.[5]

Launching of the fourth project implemented by Arricano took place in Zaporizhia in 2011 with the opening of City Mall shopping and entertainment complex having gross leasable area (GLA) of 21,450 square metres (230,900 sq ft).[6]

In 2012, RayON shopping centre, gross leasable area (GLA) of which is 24 350 sq. m.,[7] was set in operation in Kyiv. The same year, the construction of Prospekt shopping mall in Kyiv started.[8]

In 2013, Arricano obtained 4 credit facilities from Ukrainian and international banks amounting to approximately $100 million: a credit in June amounting to $25 million; a credit in July at the corporate level from UBS bank amounting to $28.8 million; a credit in August from Raiffeisen Bank Aval (Kyiv) amounting to $15 million;[9][10] a credit in October from State Savings Bank of Ukraine for the construction of Prospekt shopping mall amounting to $30 million.[11]

From September 2013, the company shares are listed at Alternative Investment Market AIM of London Stock Exchange.[12][13] Market capitalization of Arricano Real Estate plc at the time of listing was around $241 million. After the crisis of 2008—2009, this was the first public share placement of a Ukrainian developer company and the first Ukrainian IPO (initial public offering) in 2013.[14] As the result of listing of shares, Arricano Real Estate plc earned income amounting to $24 million. in the form of money funds, and it also gained four assets, which estimated value at the time of listing was $66 million. in return for the shares issued for the purposes of IPO.[15]

The same year the work for development of Lukianivka Mall shopping centre in Kyiv began.[16][17]

At the beginning of 2014, Arricano opened a second phase of South Gallery shopping centre in Simferopol, gross leasable area (GLA) of which is 32,200 square metres (347,000 sq ft). In September, an official opening of Prospekt shopping centre took place in Kyiv, its gross leasable area (GLA) is 30,400 square metres (327,000 sq ft). The same year, the credit line of EBRD was opened for Arricano amounting to $25 million. for further refunding of Prospekt shopping centre.[18][19] On 19 August 2014, London Court of International Arbitration (LCIA) made an award in favour of Arricanо restoring the company's right to repurchase the majority stake in Sky Mall shopping centre project under the terms and conditions of agreement of 2010.

In 2015, the project of Odesa Mall obtained the support of local authorities and the Governor of the Odesa Oblast.[20] The public prosecutor's office of the Region of Odesa withdrew the case of invalidation of the decision of Odesa City Council on approval of the comprehensive territory plan, developed with the participation of Arricano.[21][22]

In May 2015, Arricano became a participant of Let's Do It Together joint action social project (Ukrainian: Зробимо разом!), providing for joint efforts of the Kyiv City Council, representatives of business and the community of Kyiv for the sake of creating a comfortable environment for residents and guests of the city, improving the quality of life in the capital.[23] Within the framework of this project, Arricano presented the project for construction of Lukianivka Mall shopping centre and a large-scale accompanying project of reconstruction of road network in the area of Lukyanivka subway station, Lukyanivska square and the architectural monuments in the territory of the shopping centre.[24]

## Structure

[edit]

* 2008 – Sun Gallery shopping centre (Kryvyi Rih)[25]
* 2010 – Sky Mall shopping centre (Kyiv)[26]
* 2011 – City Mall shopping centre (Zaporizhia)[27]
* 2012 – RayON shopping centre (Kyiv)[28]
* 2014 – Prospekt shopping centre (Kyiv)[29]
* Odesa Mall shopping centre (Odesa)[30] (under construction)
* Lukianivka Mall shopping centre (Kyiv)[31] (under construction)
* Petrivka shopping centre (Kyiv)[32] (under construction)

### Sun Gallery shopping centre (Kryvyi Rih)

[edit]

Sun Gallery (Kryvyi Rih).

Sun Gallery shopping centre opened at Saksahanskyi District of Kryvyi Rih in September 2008.[33] The complex is a two-level building with GLA of 35,500 square metres (382,000 sq ft), including the stores of leading brands, a food hypermarket, a children entertainment complex, a food court zone.[34][35]

In the territory of the complex, city art exhibitions,[36] master classes, performances (Nativity scenes[37]), sports events (Yunost spartakiad, Criterium bike ride[38]) take place, social programs are implemented.[39]

### Sky Mall shopping centre (Kyiv)

[edit]

A formal opening of Sky Mall shopping centre took place on 27 August 2010 on 2 on General Vatutin avenue.[40] (In June 2017, the Kyiv City Council renamed the city's General Vatutin Avenue into Roman Shukhevych Avenue.[41][42])

In 2009, Hillar Teder invited Andrey Adamovskiy to the project in order to complete the construction of Sky Mall shopping centre (investment of $40 million.), in this way obtaining the controlling interest (50% +1 share) on the condition that Teder retains a call option (purchase option) for the share of Adamovskiy. However, in 2010, Adamovskiy refused to sell his share arguing that Teder, supposedly, violated some contract conditions. Litigations following the argument for the right of property for the facility were held at British, Cyprian and Ukrainian courts.[43]

London Court of International Arbitration LCIA finished the series of litigations on 19 August 2014, by delivering a judgement in favour of Arricanо and restoring the company's right to purchase the stock of shares from Adamovskiy through exercising the call-option subject to contract conditions of 2010 for $51.4 million.[44] LCIA Stockman Interhold S.A. (affiliated with Andrey Adamovskiy) tried to appeal against this decision; however, on 22 October 2015, High Court of Justice dismissed the company's appeal.[45][46]

In September 2014, Stockman Interhold S.A. transferred 100% of profit participation rights for the property to Dutch company Financing and Investment Solutions B. V., and the property right for the shopping centre was confirmed by Pivdenny Bank because of the outstanding debt amounting to $32 million. (management of Arricano declared the debt to be artificially created).[47]

The second re-registration of the property took place on 17 December 2014, 100% of profit participation rights of Prizma Beta LLC, a Ukrainian company owning the project, were transferred from Financing and Investment Solutions B. V. to Sky Holding LLC (Boryspil). Arricano declared that registry actions were carried out illegally, having two valid prohibitions for registry actions imposed by courts and law-enforcement authorities. Violations at transfer of 100% profit participation rights of Prisma Beta LLC were confirmed in the course of investigation held by Ukrgosreestr following which results the agency filed the request to public prosecution office.[48] Company management addressed the top public officials through mass media asking to provide for the maximal transparency, justice and efficiency in reviewing the case of Sky Mall.[49]

The dispute around Sky Mall shopping centre became the object of journalistic investigations held by the editors offices of Zerkalo Nedeli,[50] Insider,[51] Investigation Info (Sledstviye. Info),[52] Money,[53] and The Territory of Law (Terytoriya Zakonu).[54] The facts of property rights violations regarding Sky Mall shopping centre in Ukraine, pressure on the company and its employees through law-enforcement authorities were disclosed to public by mass media.

As of the end of 2015, SkyMall remains the property of Pivdenny Bank; the companies affiliated with Andrey Adamovskiy maintain the operational control over the shopping centre.

## Ratings and awards

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* 2012 – The second place by number of finished professional shopping centres and their total gross leasable area according to the rating of leading retail real estate developers, drafted by Forbes, the experts of Ernst & Young, CBRE, DTZ, Colliers and market insiders.[55][56]
* 2014 – 25th place taken by Hillar Teder in annual Rentier Rating according to Forbes.[57]
* 2015 – Prospekt shopping centre was recognized as the best public facility based on the results of competition held by State Architectural and Construction Inspectorate of Ukraine.[58]
* 2015 – Annual rating of shopping and entertainment complexes in Ukraine held by Ukrainian Retail Association. In the nomination of Traditional Average Shopping Centre, the first place was taken by Prospekt, and the second one by RayON.[59]
* 2016 – 7th place taken by Hillar Teder in annual Rentier Rating according to Forbes.[60]

## References

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1. ^ В Arricano меняется состав совета директоров
2. ^ Годовой отчет Arricano Real Estate plc за 2014 год
3. ^ В Кривом Роге открылся ТРЦ «Солнечная галерея»
4. ^ Коммерческая недвижимость Киева: повод для надежды
5. ^ Dragon Capital вкладывает средства в коммерческую недвижимость
6. ^ City Mall в Запорожье открыт!
7. ^ "«Недвижимость Киева. Путеводитель по украинскому рынку недвижимости, 2013». «Торговая недвижимость Киева – динамический сектор»" (PDF). Archived from the original (PDF) on 11 August 2017. Retrieved 27 April 2016.
8. ^ Arricano Group начинает строительство ТРК в Киеве стоимостью $100 млн.
9. ^ Arricano group receives loan from Raiffeisen Bank Aval
10. ^ "Райффайзен Банк Аваль предоставил кредит Arricano Group". Archived from the original on 15 December 2017. Retrieved 27 April 2016.
11. ^ «Дочка» девелопера Arricano привлекла у «Ощадбанка» 30 млн долл.
12. ^ Девелопер Arricano готовится к IPO на AIM LSE по цене $2,33 за акцию
13. ^ Девелопер Arricano Trading планирует в 2013г выйти на IPO
14. ^ С 2014 г. малый и средний бизнес в Украине получит выход на IPO
15. ^ Девелопер Arricano привлек 24 млн долл. в ходе IPO на Лондонской фондовой бирже
16. ^ В Киеве на Лукьяновке построят ТРЦ и организуют новую схему движения транспорта
17. ^ Самый жаркий понедельник украинского девелопмента выпадает на 14 октября. City Evolution надвигается!
18. ^ ЕБРР предоставит Arricano $25 млн на ТРЦ «Проспект»
19. ^ "Arricano привлекла кредит от ЕБРР размере 25 млн. дол". Archived from the original on 8 March 2016. Retrieved 27 April 2016.
20. ^ Международный девелопер Arricano планирует инвестировать в Одессу около 80 млн долларов
21. ^ Саакашвили требует привлечь к ответственности зампрокурора области за препятствие инвесторам зайти в Одессу со 100 миллионами
22. ^ М. Саакашвили поддержал строительство крупного ТРЦ в Одессе
23. ^ "Зробимо разом! Соціальний проект спільної дії". Archived from the original on 8 March 2016. Retrieved 27 April 2016.
24. ^ "На Лук'янівці реконструюють площу і відреставрують пам'ятники". segodnya.ua (in Ukrainian). 11 July 2022. Retrieved 9 June 2023.
25. ^ Sun Gallery Shopping and Entertainment Complex (SEC)
26. ^ Sky Mall Shopping and Entertainment Centre (SEC)
27. ^ City Mall Shopping and Entertainment Complex (SEC)
28. ^ RayON Shopping and Entertainment Centre (SEC)
29. ^ Prospekt Shopping and Entertainment Complex (SEC)
30. ^ "Инвестиции в Одессу от Arricano в размере 80 млн. долларов пойдут в недвижимость". Archived from the original on 9 March 2016. Retrieved 24 April 2016.
31. ^ "На Лукьяновке строят новый ТРК с зеленой зоной на крыше". Archived from the original on 1 April 2016. Retrieved 24 April 2016.
32. ^ "Arricano Group расширит свой портфель проектов до конца 2012г". Archived from the original on 9 March 2016. Retrieved 24 April 2016.
33. ^ "Солнечная галерея — Ашан-Кривой Рог: Виртуальный Тур". Archived from the original on 1 May 2016. Retrieved 27 April 2016.
34. ^ "ТРЦ «Солнечная галерея»". Archived from the original on 6 April 2016. Retrieved 27 April 2016.
35. ^ "Торгово-развлекательный центр "Солнечная галерея (Ашан-Кривой Рог)"". Archived from the original on 3 April 2016. Retrieved 27 April 2016.
36. ^ "Открылась выставка молодых художников — «Молодіжний салон». 07 марта 2015 года, Кривой Рог, Солнечная галерея, Художественная галерея «Фарт»". Archived from the original on 15 December 2017. Retrieved 27 April 2016.
37. ^ Різдвяний Вертеп у ТЦ Сонячна Галерея 09.01.16
38. ^ В Кривом Роге состоялись велопробег Critical Mass и велогонка Criterium
39. ^ Fly Park в ТРК «Солнечная галерея» проводит социальные программы для особенных детей
40. ^ Сегодня открытие Sky Mall
41. ^ "Kyiv's General Vatutin Avenue renamed Roman Shukhevych Avenue". Kyiv Post. 1 June 2017.
42. ^ "Court leaves avenues named after Bandera, Shukhevych in Kyiv". Kyiv Post. 9 December 2019.
43. ^ Томаш Фиала просит руководство Украины обеспечить правовое решение вокруг Sky Mall
44. ^ Arricano отсудила в Лондонском суде право на выкуп акций Sky Mall
45. ^ "Суд разрешил девелоперу Arricano выкупить долю в ТРК Sky Mall". Archived from the original on 11 August 2017. Retrieved 27 April 2016.
46. ^ Суд обязал Адамовского вернуть Малицкому и Филиппенко 35,8 млн долл. за их долю в Oledo
47. ^ Очная ставка: Адамовский VS Тедер. Кому достанется ТРЦ Sky Mall
48. ^ Arricano заявляет о незаконной повторной перерегистрации проекта ТРК SkyMall
49. ^ "Андрей Адамовский и Александр Грановский пытаются отобрать у Arricano ТРЦ SkyMall". Archived from the original on 20 April 2016. Retrieved 27 April 2016.
50. ^ "Бизнес по-украински: тайны 58 номера избирательного списка". Archived from the original on 20 April 2016. Retrieved 27 April 2016.
51. ^ Почему на Кипре хотят допросить депутата от Блока Порошенко Archived 2 April 2016 at the Wayback Machine
52. ^ Гола правда блоку президента Archived 3 May 2015 at the Wayback Machine
53. ^ Гроші. Рекет по-новому
54. ^ Територія закону 22 11 2015
55. ^ 9 крупнейших девелоперов торговой недвижимости
56. ^ Составлен рейтинг крупнейших девелоперов торговой недвижимости
57. ^ Рейтинг рантье-2013
58. ^ ЖК «Парковый город» и ТЦ «Проспект» названы лучшими постройками Украины
59. ^ "Два объекта компании Arricano стали победителями в рейтинге торговых центров Киева 2015 года". Archived from the original on 9 March 2016. Retrieved 27 April 2016.
60. ^ Рейтинг рантье-2015

## External links

[edit]

* Official website of Arricano Real Estate plc
* Arricano Real Estate plc at London Stock Exchange website