Scentre Group announced the Perron Group will be a new 50% joint venture partner in Westfield Burwood in Sydney. Perron Group will pay $575 million for its interest, representing a 4.1% premium to Scentre Group’s book value at 31 December 2018.
Scentre Group CEO Peter Allen said: “We are pleased to extend our long-standing relationship with the Perron Group into Westfield Burwood. This transaction highlights the value of Scentre Group’s extraordinary platform of 41 Westfield living centres. The proceeds will provide the Group with further capital to pursue our strategic objectives of creating long-term value for securityholders.”
Perron Group CEO Ross Robertson said: “We are excited by the unique opportunity to invest in one of the highest quality shopping centres in Australia. Westfield Burwood is one of the top 50 shopping centres in Australia with customer visitation of more than 14 million per annum and total retail sales of close to $500 million.”
The proceeds from the transaction will initially be used to repay debt. The transaction is expected to be dilutive to FFO per security in 2019 by approximately 0.2 cents per security.The forecast distribution for 2019 remains unchanged at 22.60 cents per security.
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Westfield Burwood is centrally located within Sydney’s Inner West, approximately 12 kilometres from the CBD. Strategically positioned within easy reach of Burwood Railway Station on the bustling commercial strip, the centre caters to a trade area population in excess of 464,000 residents.
The Total Trade Area retail spend is estimated at $6.7 billion while the Main Trade Area spend is estimated to be $3.7 billion.
Westfield Burwood’s spend per capita for the Main Trade Area is estimated at $14,936 which is broadly in line with the Sydney Metro average ($14,831).
Source: Scentre Group