· The company has obtained a long-term BBB- Investment Grade rating, and improved its ratings outlook from stable to positive

· The updated assessment takes account of a number of factors, including Castellana Properties’ acceptance of an offer from Helios, the acquisition of three shopping centres in Portugal and various refurbishment projects currently under way at properties in its portfolio.

Castellana Properties, the listed specialist retail property firm, has been awarded a long-term BBB- Investment Grade credit rating for the third year running by internationally renowned credit rating agency Fitch, which upgraded the company’s ratings outlook from stable to positive.

The new score reflects a number of factors including a recent deal to sell its 28.8% stake in Lar España Real Estate SOCIMI, S.A for €199.9 million.

Fitch Ratings evaluates companies, local authorities, regions and countries on their capacity to repay their debts and their potential to attract investment. The agency took a very positive view of Castellana Properties’ decision to accept the cash offer and reinvest the proceeds in its shopping centre portfolio.

It was also influenced by Castellana Properties’ recent acquisition of three shopping centres in Portugal (Rio Sul and Loures in Lisbon and 8ª Avenida in Sao Joao de Madeira, just outside Porto) for a total of €176.5 million. This deal will result in a more diverse portfolio from a geographical perspective and broaden the company’s tenant base.

Fitch Ratings also took account of ongoing repositioning and upgrade projects at El Faro (Badajoz), Los Arcos and Vallsur (Valladolid) shopping centres. At Vallsur, work has focused on expanding the choice of leisure and dining options, while at El Faro the company has taken over the former Hipercor site and carried out extensive remodelling to attract new tenants and optimise rents. Finally, the second phase of a renovation programme at Los Arcos (Seville) is expected to deliver a surge in footfall thanks to an adjacent development of 2,000 new homes, scheduled for completion in 2025.

This positive rating also highlights a growth in tenant sales at the company’s existing centres, where its exceptionally high occupancy rate (99%) is seen as a marker of stability. Sales have risen in FY2024 among tenants in the F&B and leisure sectors (up 10% and 9% respectively), regarded as footfall anchors. Other retailers have seen a knock-on effect, with fashion sales increasing by 6%, household goods by 4% and health and beauty by 12%. The latter three categories account for 56% of all tenant sales for the portfolio as a whole.

Fitch’s verdict underlines the level of effort put in by Castellana Properties over the last year. The company’s portfolio is highly regarded and currently valued at over €1,200 million (gross). It comprises 18 assets, all shopping centres and retail parks distributed throughout Spain and Portugal.

Débora Santamaría, CFO of Castellana Properties, stated, “We are immensely proud to receive such a positive evaluation of our company’s performance, both in terms of investment and active management, from one of the world’s most trusted credit rating agencies. At Castellana Properties, we will continue to stand behind the Spanish retail sector, investing in projects that enhance our portfolio’s standing and keep us moving in the direction of growth.”