Shopping centre developer Westfield Group has proposed to restructure its business by creating a separately-listed property trust, expected to distribute $7.3 billion to securityholders.
To be owned by new and existing shareholders, Westfield Retail Trust will become the joint venture partner in 54 of the Westfield Group’s Australian and New Zealand shopping centres, comprising of 13,195 retail outlets that generated $22 billion retail sales last year.
This announcement follows Westfield Group’s trading halt on Tuesday.
Westfield Group chairman Frank Lowy said this is just another strategy over the company’s 50-year history that will position it for growth.
“As the global economies emerge from the recent crisis and we near the completion of a major of global redevelopments, we are able to restructure, distribute capital to securityholders and remain in a very strong position to pursue our global growth opportunities,” he said.
“The new trust will provide existing Westfield Group securityholders, as well as new investors, the opportunity to invest in the pre-eminent retail property portfolio in Australia and New Zealand.
“It responds directly to significant market demand for a domestic trust focussed on investing in high quality retail real estate, with conservative gearing and income source primarily in Australian dollar.”
Westfield Group said the Retail Trust will become an investor in Australian and New Zealand retail property, focussed on maximising the long-term investment returns from its portfolio.
It will have gross assets of $12.2 billion and is expected to have a gearing ratio in the range of less than 10 to 24 per cent, depending on the amount raised under the Offer. It is also expected to be one of the three largest listed A-Reits in Australia.