Retail property group, Vicinity Centres, has offloaded $841.4 million in retail assets, selling four major sub-regional shopping centres in Queensland and Victoria as part of its ongoing divestment initiative.
The company sold Clifford Gardens in Queensland, plus Forest Hill Chase and Brimbank Shopping Centre in Victoria to affiliates of funds managed by investment banking company Blackstone for $613.3 million.
Vicinity has also sold Toombul Shopping Centre in Queensland to real estate group Mirvac for $228.1 million.
Vicinity Centres sold the shopping centre assets as part of its ongoing divestment initiative to sell down assets which aren’t core to its portfolio strategy, on the basis that more value could be created by investing in their development pipeline and selective acquisitions.
The portfolio sale is Vicinity’s second divestment in a week, following the sale of Indooroopilly Central in Queensland to a private investor for $85 million.
Vicinity chief investment officer, Michael O’Brien, said the divestments will free up significant capital.
“In the short term, the sale proceeds will be used to repay debt,” he said.
“Over time, this capital will be reinvested into value-accretive development and acquisition opportunities, further enhancing the quality of our portfolio.”
Vicinity has more than $23 billion in retail assets under management across 95 shopping centres, making it the second largest listed manager of Australian retail property.
The company recently announced a joint venture with Perth Airport to develop a new direct factory outlet centre at Perth Airport for $145 million.
Vicinity also plans to offload a “smaller tranche of assets” in the coming weeks, O’Brien said on Monday in a statement.
Blackstone’s acquisition is subject to approval from the Foreign Investment Review Board, with settlement of both transactions expected before June 30.
At 1026 AEST, Vicinity shares were up one cent, or 0.3 per cent, at $3.36 in a higher Australian market.
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