Federation Centres, previously known as Centro, has sold off its 50 per cent stake in a portfolio of six assets to various funds managed by Challenger for $602 million.

The assets consists of the regional shopping centres at Bankstown and Roselands in NSW, and the convenience centres at Toormina and Lennox, in NSW, Sunshine in Victoria and Karratha in Western Australia. These are owned by FDC and certain Retail Direct Property syndicates with a gross value of $1.2 billion.

FDC will remain as the manager of these centres and will be responsible for managing the redevelopment program.

FDC managing director and CEO Steven Sewell said the sale is consistent with previous strategic alliance transactions.

“FDC was engaged to continue to provide all property-related services when Challenger acquired the FDC-managed and RDP syndicate-owned Surfers Paradise Centre in Queensland. It is pleasing that we have now agreed to extend our alliance to also include co-ownership of a larger group of other centres,” he said.

“We look forward to working with Challenger at these quality shopping centre destinations to provide an engaging shopping experience for our consumers and enhanced returns for investors.”

Subject to the satisfaction of certain conditions, the transaction will be completed in two phases with the sale of Bankstown, Toormina, Roselands and Karratha centres to occur by 30 June 2013 totally approximately $530 million. To follow this will be Lennox and Sunshine centres to occur by 31 July 2013.