This article is from the Australian Property Journal archive
FEDERATION Centres has gone on a shopping spree, buying three assets including the $416.25 million Mt Ommaney Centre in partnership with US giant TIAA Henderson Real Estate.
Under the arrangement, TIAA Henderson Real Estate will acquire a 75% interest in Mt Ommaney Centre, a regional shopping centre in Brisbane.
FDC will own the remaining 25% and will contribute $104.06 million to purchase, and it will provide ongoing property management services at the centre.
TH Real Estate Australia executive director Nick Evans said this is the group’s first retail property purchase in Australia.
“We are excited to have established a new partnership with Federation Centres and to have made our first foray into the Australian retail market. Mt Ommaney represents a dominant regional centre with a strong tenant base, and provides an opportunity to further unlock potential value.
“The investment is testament to our long term strategy within Australia, where we are committed to building a sustainable business. We are delighted to co-invest with a specialist local mall operator such as Federation Centres and look forward to a collaborative working relationship.
“Our experience investing into prime malls across the globe gives TH Real Estate the ability to identify and source the best investments on behalf of its clients. TH Real Estate owns over AUD$18 billion of retail assets throughout Europe and Asia alone, representing over 170 standing investments,” he added.
FDC CEO Steven Sewell said Mt Ommaney Centre is a high quality regional shopping centre in a strong demographic market in the western suburbs of Brisbane.
“The transaction will substantially increase our management of centres in Queensland and, combined with our $1.3 billion redevelopment pipeline, represents continued enhancement and improvement of the FDC portfolio of Australian shopping centres,” Sewell said.
Located approximately 14 km south-west of the Brisbane CBD, the 56,570 sqm single level centre was originally completed in 1979 and expanded in 2010. It is anchored by three discount department stores, namely Big W, Target and Kmart, as well as a Woolworths, Coles and Aldi supermarkets and four mini major tenants. In addition, there are 165 specialty tenants and kiosks.
In another separate transaction, FDC has entered into a 50/50 coâ€ownership arrangement with an undisclosed superannuation fund coâ€ownership partner. It is speculated that the fund is Telstra Super, which has teamed up with Federation Centres previously to buy the Carlingford Court sub-regional shopping centre in Sydney for $177 million.
The JV partners will acquire the Brandon Park Centre at Wheelers Hill in Melbourne’s east from the unlisted syndicate, Retail Direct Property 6. FDC has also now acquired all external units in RDP 6 and has a direct 50% interest in Brandon Park.
Finally, FDC has bought a 50% interest in the convenience centre, Bentons Square in Mornington, Victoria from a private investor for $38.25 million.
Bentons Square is anchored by a Woolworths supermarket, Dan Murphy’s liquor store and approximately 40 specialty shops. The supermarket is one of the best performing Woolworths in Victoria.
As part of the deal, FDC will manage leasing and operations at the centre and will have an option to buy the remaining 50% interest before or in July 2016.
“Bentons Square builds on our strong representation in the Victorian market with a quality convenience centre in the wellâ€established Mornington Peninsula region.
“These three transactions reflect our ongoing commitment to realigning our portfolio towards quality and diversification, together with our strategy of capital recycling and partnerships to optimise returns for our investors,” Sewell said.
Australian Property Journal
