Table of Contents
Castellana Properties, the Spanish unit of Vukile Property Fund Limited, the Johannesburg-listed retail REIT led by South African executive Laurence Rapp, has agreed to sell its entire portfolio of retail parks in Spain for €279 million ($334 million), marking a clean exit from assets it has owned and managed for nearly a decade.
The sale concludes Castellana’s involvement in the retail parks it began acquiring in 2017, as Vukile shifts focus to higher-growth European shopping centers. Castellana, 99.7 percent owned by Vukile, will transfer the assets to Ferrel SPV 2025, a special-purpose vehicle backed by funds managed by affiliates of New York Stock Exchange-listed Ares Management. The deal covers nine Castellana-owned companies holding retail parks across Spain.
$334 million disposal locks in operational gains
The disposal is expected to close on April 1, 2026, with the purchase price payable in cash on completion. The €279 million ($334 million) consideration is based on the financial position of the disposal companies as of Oct. 31, 2025, and may be subject to customary closing adjustments. Castellana said it does not expect any material change to the final price. The transaction implies a disposal yield of 7.1 percent.
Castellana said the sale reflects a decision to recycle capital after years of steady operational improvement across the portfolio. Since acquiring the assets, the company has increased net operating income by about €3.7 million ($4.43 million), representing a 26 percent rise, driven by hands-on asset management and leasing initiatives. The sale price aligns with the most recent external valuations and locks in gains from both operational progress and asset revaluations.
Castellana achieves 13 percent net gain
Between acquisition and disposal, the revaluation of net asset value resulted in a net gain of 13 percent for Castellana. The company said this was achieved despite a period shaped by higher global interest rates, the Covid-19 pandemic and the effects of the Russia-Ukraine war. Management added that strong investor appetite for Spanish retail parks has supported pricing and encouraged new supply, making the timing of the exit attractive.
At the same time, Castellana noted that development of new shopping centers in Spain remains tightly constrained, supporting the case for reinvesting in that segment. Proceeds from the sale, alongside existing cash resources including funds raised in October 2025, will be directed toward value-enhancing shopping center investments that are already well advanced.
Castellana will continue to manage the retail park portfolio until the transaction closes. The deal is not subject to conditions precedent and includes standard warranties and indemnities. The disposal is not expected to affect Vukile’s earnings guidance for the year ending March 31, 2026. Castellana has also entered into a five-year asset and property management agreement with the buyer, under which it will continue managing the assets for market-standard fees.
Vukile deepens global retail reach
The sale comes as Vukile looks beyond its established bases in Spain and Portugal, where it has built scale through Castellana, listed in Madrid. Vukile’s property portfolio is valued at about R50 billion ($3.1 billion), split between South Africa and the Iberian Peninsula. Laurence Rapp, who owns more than 4 million shares in the company, has overseen the group’s expansion while keeping its focus on income-generating retail properties.
Last week, Vukile took another step in broadening its international footprint, acquiring a 35 percent stake in Pradera Ltd. in a transaction that values the global retail platform at R94.7 billion ($5.9 billion). The REIT said the investment provides access to a specialist retail property manager with operations across Europe, the United Kingdom, China and the Middle East, reinforcing its approach of pairing offshore growth with on-the-ground expertise.
