Singapore-based real estate investment trust SPH Reit Management plans to acquire an 85 per cent stake in a shopping centre south of Sydney for $124.5 million (A$175.1 million).
According to an official statement, this is SPH Reit’s first investment overseas and will be financed through a combination of debt and internal sources.
Figtree Grove Shopping Centre is located about 3.7 km southwest of the Wollongong and 71 km southwest of Sydney. It occupies a total gross lettable area of 21,984 sqm, including facilities like a 24-hour Kmart, supermarkets, retailers and dining options. It sits on a freehold land area of 50,900 sqm.
The proposed acquisition will be made through Figtree Holding Trust, a wholly owned sub-trust of a joint venture between SPH Reit and entities managed by Moelis Australia, an ASX-listed financial services group.
The property is priced at $146.4 million (A$206 million).
“The acquisition of Figtree Grove Shopping Centre is a strategic fit with SPH REIT’s portfolio of quality assets and in-line with our strategy to expand our footprint into Australia. With a WALE of 5.4 years by income and built-in rental escalations, the acquisition will provide stable and growing income to our unitholders,” said SPH REIT chief executive Susan Leng.
“The partnership with SPH REIT fits perfectly with our strategy of working with respected and strong offshore investment groups to acquire fundamentally sound investment grade assets with upside potential in the Australian marketplace. SPH REIT’s investment requirements aligned well with our strategy of identifying and acquiring strong performing Australian shopping centres with sound trade area demographics and good growth prospects,” said Chris Monaghan, Managing Director and Head of Real Estate Asset Management at Moelis Australia.
SPH REIT primarily invests in real estate used for retail purposes. Its portfolio includes Paragon, The Clementi Mall and The Rail Mall with an aggregate net lettable area of approximately 960,000 sq ft.