Vicinity Centres in $55m deal for DFO Brisbane
Vicinity Centres has added yet another Direct Factory Outlets shopping centre to its stable, paying $55 million for DFO Brisbane.
The property group will take over the management of the DFO business at Brisbane Airport under a sublease from Brisbane Airport Corporation, which holds the head lease over the land and owns the buildings.
Vicinity’s latest acquisition comes just weeks after it announced it had entered into a $145 million agreement with Perth Airport to build a DFO on airport land.
Divestment program: Vicinity Centres sells $841m portfolio
The Brisbane deal will bring its number of Outlet Centres under management to six.
Vicinity CEO and managing director Angus McNaughton says acquiring the DFO Brisbane business was a part of the 2010 deal that saw it take control of four Direct Factory Outlets facilities across Victoria and New South Wales.
“Vicinity has been operating DFO Outlet Centres since 2010 following the acquisition of four assets, DFO Homebush in New South Wales, and DFO South Wharf, DFO Essendon and DFO Moorabbin in Victoria,” McNaughton says.
Vicinity Centres acquired four DFO centres, including DFO Moorabbin, in 2010.
“As part of the DFO asset acquisition by Vicinity in 2010, Vicinity obtained a first right over the DFO Brisbane business. Today’s announcement follows Vicinity exercising this right.”
“We are excited to be acquiring Queensland’s leading Outlet Centre, the DFO Brisbane business, less than three weeks after entering into a joint venture agreement to develop a new Outlet Centre at Perth Airport,” McNaughton says.
“Vicinity’s Outlet Centre portfolio, including DFO Brisbane, now has a combined value of over $1.1 billion in assets under management.”
While Vicinity Centres continues to grow its DFO footprint, it has been systematically divesting other retail assets.
Earlier this month it sold four shopping centres in Victoria and Queensland for a combined $841.4 million, just days after offloading Queensland’s Indooroopilly Central for $85 million.
Vicinity Centres sold Toombul Shopping Centre to Blackstone.
American investment firm Blackstone bought three of the malls, paying $613.3 million for Forest Hill Chase Shopping Centre and Brimbank Shopping Centre in Victoria, and Clifford Gardens in Queensland, while Mirvac bought Toombul in Queensland for $228.1 million.
Vicinity subsequently announced it had extended its asset divestment program from between $750 million and $1 billion to about $1.5 billion, in a bid to free up money, which in part is to be used to continue targeting DFO centres.
“With a range of portfolio enhancing opportunities available to us through investment in our development pipeline and selective acquisitions, including continued expansion in the Outlet Centre space, we are extending the size of our asset divestment program,” McNaughton says.
Among the extra assets to be sold is a 25% interest in The Myer Centre Brisbane and a 50% interest in Mornington Central in bayside Victoria, which are to be sold to ISPT for $224.6 million, while another $350 million tranche of property will also be put on the market.
