- Vicinity (VCX) strengthens outlet portfolio with acquisition of 50 per cent interest in Harbour Town Premium Outlets Gold Coast
- Lewis Land Group (LLG) will keep a 50 per cent stake in the asset and continue to operate it, while Vicinity will handle all leasing activities
- The freehold asset spans 223,000 sqm with a gross lettable area of 55,693 sqm and space for 3022 cars
- Shares in VCX are trading in the grey at $1.69 at 1:32 pm AEDT
Vicinity Centres (VCX) has achieved a conditional agreement to purchase a 50 per cent stake in Harbour Town Premium Outlets Gold Coast in Queensland from Lendlease (LLC) managed Australian Prime Property Fund Retail for $358 million.
Lewis Land Group (LLG) will keep a 50 per cent stake in the asset and continue to operate it, while Vicinity will handle all leasing activities.
The transaction is contingent on LLG relinquishing its pre-emptive right to acquire as a Harbour Town co-owner.
The acquisition price reflects a capitalisation rate of five per cent. The purchase is expected to be funds from operations (FFO) and adjusted funds from operations (AFFO) accretive in FY 22.
Vicinity said the acquisition bolstered its market share in the outlet centre category while providing an opportunity to leverage existing retail partnerships to introduce new brands and enhance rental income at the centre.
The acquisition will be funded by existing debt facilities with gearing to increase by roughly 210 basis points.
CBRE’s Simon Rooney initiated the deal, which was handled in collaboration with McVay Real Estate as a joint agent.
Vicinity CEO and managing director Grant Kelley said the acquisition reflected the company’s strategy to invest in premium retail assets.
“Harbour Town is located in an attractive trade area and the centre’s annual MAT is more than double the average MAT for Vicinity’s current outlet portfolio and is expected to grow at more than 3% per annum to 2031,” he said.
“We will continue to optimise our asset portfolio by actively considering acquisition opportunities where we can add value as well as divestment opportunities that make strong strategic and economic sense for Vicinity and its securityholders.”
The retail property group sees potential in the asset, noting the potential to elevate the centre with more defined outlet, food and leisure precincts.
Woolworths and Reading Cinemas anchor the asset, with 17 mini-majors, 189 specialists, seven kiosks and eight offices rounding out the asset.
The freehold asset spans 223,000 sqm with a gross lettable area of 55,693 sqm and space for 3022 cars.
The centre enjoys 8.3 million visitors per annum and a 98.7 per cent occupancy rate.
Shares in VCX are trading in the grey at $1.69 at 1:32 pm AEDT.