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Singapore’s sovereign wealth fund GIC announced on Monday (6 November) that it has agreed to acquire a 49 percent stake in Chatswood Chase Sydney mall worth AU$562.3 million (S$767.2 million) from Australian retail property group Vicinity Centres.
This is in exchange for a 50 percent stake collectively valued at AU$556 million (S$758.61 million) in GIC’s The Galeries, Queen Victoria Building and The Strand Arcade.
Chatswood Chase Sydney is a major regional shopping centre in Sydney’s North Shore that attracts over 11 million consumer visits every year. Aside from its three anchor tenants consisting of Coles, Kmart and David Jones stores, it houses 170 specialty stores, including upscale brands.
“This [stake] swap transaction in Chatswood Chase Sydney, a high-quality shopping centre with resilient cashflows, allows us to gain access to a new development and enhancement opportunities. We have worked with Vicinity on Emporium Melbourne and Myer Bourke Street, and look forward to strengthening our long-term partnership,” said GIC Real Estate’s Chief Investment Officer Lee Kok Sun.
On the other hand, the other three shopping centres in Sydney’s central business district have been managed by Ipoh Pty Ltd since 2003. This specialist retail property, investment and management company is owned by GIC Real Estate Pte Ltd via its Australian investment vehicle Reco Bay Australia Pty Ltd.
“This transaction is strategically significant for Vicinity. We gain exposure to, and the management rights of, three high quality and strongly performing [shopping] centres in Sydney, Australia’s most populous and most visited CBD. This transaction also expands our strong relationship with GIC,” noted its CEO and Managing Director Angus McNaughton.
Upon completion of the transaction by early-2018, Vicinity will still run Chatswood and will take over the property management of the other three malls. But the deal is subject to the approval of the Sydney City Council, Australia’s Foreign Investment Review Board (FIRB) and RailCorp, a train operator owned by the New South Wales (NSW) government.
This article was edited by Keshia Faculin.
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