Creating A New City District on the Site of the Copenhagen Wholesale Market

Copenhagen - A consortium consisting of Hoffmann Ejendomme, the Danish property developers, and The Carlyle Group, the global private equity firm, is in the process of acquiring the Copenhagen Wholesale Market (Grønttorvet København). The market activities located here will move, in a few years, to what will be the largest trading centre for food and flowers in northern Europe, located in the western suburb, Høje Taastrup.

An agreement has been reached between the Copenhagen Wholesale Market (Grønttorvet København s.m.b.a) and a consortium consisting of Hoffmann Ejendomme, the Danish property developers, and The Carlyle Group, the global private equity firm, to the effect that the consortium will take over the area with a view to development. The aim is to build a completely new city district on this site, which extends over 16 hectares (approx. 40 acres) in the Valby area of Copenhagen, the capital city of Denmark.

It is expected that the transfer of ownership will take place on or around New Year 2011, the point at which the Copenhagen Wholesale Market activities move to a specially built food and flowers market at the Høje Taastrup Transport Center. The sales agreement is, however, conditional on approval by an extraordinary general meeting of the Copenhagen Wholesale Market in late June 2007.

In spring 2006 the board of directors of Copenhagen Wholesale Market decided to put the old market, which dates from 1958, up for sale. The prime reasons were space constraints, the likelihood of substantial investments being needed for the necessary modernisation work, and the risk that future environmental zoning regulations in Copenhagen would make it impossible for heavy goods traffic to access the Valby site by road. As a result, the market area was put up for sale via the estate agents DTZ Denmark and Nielsen & Partnere A/S.

Negotiations between Copenhagen Wholesale Market and the consortium began around the beginning of 2007. The parties concerned have now reached agreement that the buyers will take over both the site and the buildings two years subsequent to there being a final, unchallenged local development plan for this area, prepared by the Municipality of Copenhagen.

Development in close collaboration with local people
Hoffmann Ejendomme and The Carlyle Group have established a joint development company known as CVM Development. This company will work in close collaboration with local people in Valby, with experts in architecture and urban planning from both Denmark and abroad, and with politicians and civil servants from the Municipality of Copenhagen, with the aim of preparing a set of proposals for a completely new city district located in what was once the Copenhagen Wholesale Market.

Based on these initial proposals, the Municipality of Copenhagen will prepare the final proposal for the definitive local development plan for this area. This is expected to be ready by the end of 2008, and the consortium expects that the first residences in this new part of the city of Copenhagen will be ready for use in 2012, and that the total investment in the project will reach DKK 6-8 billion ( Euro 0,8-1,25 million).

The overall process of developing ideas for this project will begin in the autumn of 2007 and will be conducted by the Juul/Frost Arkitekter architectural practice, a company with considerable experience and expertise from other similar assignments both in Denmark and abroad.

"The Copenhagen Wholesale Market site is one of the most exciting development projects in the city of Copenhagen. This is because the site is close to the city centre, and also provides a unique opportunity to create an entirely new, coherent district virtually from scratch. For us, it is crucial that this takes place as a process of dialogue with local residents, visionary experts and the Municipality of Copenhagen," says the managing director of Hoffmann Ejendomme, Mr Gert Olsen, who is also the spokesman for the consortium.

"We consider Copenhagen and the whole Øresund-region as one of the most important centres of growth and development in Northern Europe. We are excited by the opportunity to build a new city district in an extremely attractive location and the project is a perfect match with our investment strategy," says Managing Director of The Carlyle Group, Mr Thomas Lindström.

"We are extremely pleased with this agreement because it provides us with the financial opportunity to move our activities to a modern trading centre for food and flowers, located in Høje Taastrup. This will enable us to provide wholesalers with substantially better facilities and conditions than at the Valby site, and will also enable us to include new fields of activity, such as meat and fish," says Mr Torben Flinch, managing director of the Copenhagen Wholesale Market, commenting on the agreement.