TIAA-CREF, the pension fund manager for teachers in the US, has signed a preliminary agreement to buy a shopping centre in Munich for about EUR 415 mln, according to those who track the market. The price reflects a net initial yield of 4.6%, which is a record low for prime shopping centres traded so far this year in Germany.

The New York-based pension fund manager will acquire Perlacher Einkaufsparadies, known as PEP, from RREEF Real Estate, the property investment arm of Deutsche Bank. Jones Lang LaSalle is managing the sale.

Located in the eastern part of Munich, the mall offers 50,000 m2 of retail space across 125 shops, a department store, supermarket, restaurants and cafes.