In a joint venture with Telstra Super, Charter Hall Retail REIT has expanded its shopping centre portfolio by buying eight neighbourhood and sub-regional shopping centres from Woolworths for $266 million.
Charter Hall Retail CEO Steven Sewell said the acquisition will enhance the company’s income security and growth.
“The acquisition of this portfolio represents one of the key capital management initiatives which are being pursued by the REIT – buy-back of units, redevelopment of our existing portfolio and acquiring quality neighbourhood and sub-regional shopping centres in Australia,” he said.
“Having exchanged contracts on this portfolio, we will now look to re-activate the previously announced buy-back of the REIT’s units, where it is accretive to earnings and NTA.”
All of the shopping centres were developed by Woolworths between 1999 and 2009 and all anchored by a full line Woolworths supermarket. In total, Woolworths’ businesses – including supermarkets, Big W discount department stores, Dick Smith Electronics, Woolworths Liquor and Dan Murphy liquor outlets – account for more than 51 per cent of the portfolio’s annual base rent.
The properties that have been acquired in NSW are Carnes Hill, Highlands, Pemulwuy, Rutherford, Thornleigh, West Ryde and Windsor, as well as Pakington Strand, Victoria.
According to Charter Hall Retail, the net operating income for the 2012 financial year is forecast to be approximately $21.33 million, using externally verified sales forecasts for the anchor tenants.