UK shopping centres snapped up for €1bn
Intu Properties, the UK's largest shopping-mall owner, agreed to buy three retail centres from Westfield Group for £867.8m (€1bn) including working capital.
Intu will purchase a mall in the English city of Derby and the Sprucefield retail park in Northern Ireland, as well as a 50 per cent stake in the Westfield Merry Hill centre near Birmingham, the London-based company said in a statement.
To finance the acquisitions, Intu will raise about £500m in a share sale and will also raise new debt facilities of £423.8m.
The UK's largest real estate companies are using their access to capital to invest in properties and developments as values rise.
UK commercial real estate values rose for the 10th straight month in February, according to data compiled by IPD.
The deal "is a rare and attractive opportunity to acquire a further two prime shopping centres in line with our strategy to focus on the UK's largest and most successful destinations," Intu Chief Executive Officer David Fischel said in the statement.
Intu dropped as much as 4.6 per cent in London trading after the announcement.
Westfield, which owned the malls with partners, will receive £597m from the sale, in line with book value, it said in a separate statement. The Sydney-based company owns the White City mall in London and half of the city's Stratford shopping centre. Westfield plans to develop a third large-scale mall in Croydon, south of the UK capital, in a venture with Hammerson.
Westfield in December proposed creating a separate company to manage its Australian and New Zealand properties, enabling the rest of the business to focus on expanding overseas, particularly in the US and UK. (Bloomberg)
Sunday Indo Business