Serdika Center, one of six Central and Eastern European malls acquired by Nepi Rockcastle. Picture: FABRYECE SERDIKA CENTER
Serdika Center, one of six Central and Eastern European malls acquired by Nepi Rockcastle. Picture: FABRYECE SERDIKA CENTER

Property group Nepi Rockcastle said on Wednesday that there has been a breach of agreement in the sale of its Romanian office portfolio.

The group was considering its options after the disposal, which was due to be completed on Tuesday, failed to proceed. This was not due to a disruption in processing the transaction due to the Covid-19 outbreak, the group said.

The group, which has a market capitalisation of about R44bn, said in December that it would sell its Romanian office portfolio for €290m (R5.7bn) as it shifts its focus to retail.

The assets, which include three properties in Bucharest, and one in Timișoara, will be sold to AFI Europe, a wholly owned subsidiary of Africa Israel Properties. 

The parties had been discussing terms, including a postponement, but a consensus was not reached, Nepi said.

The group said it is “currently assessing a suitable course of action in accordance with the contractual mechanisms in place and claiming the contractual guarantee provided by the purchaser regarding the closing procedures”.

The share price was down 1.45% to R73.91, having fallen 40.31% so far in 2020. Over the same period, the JSE property index has halved.

gernetzkyk@businesslive.co.za