Colonial First State Property Retail Pty Limited, Manager of CFS Retail Property Trust (CFX), today announced it had exchanged contracts to acquire Northgate Shopping Centre located in Glenorchy, Tasmania for $70.1 million (excluding acquisition costs) at an initial yield of over 9%. Northgate Shopping Centre is situated approximately 8 km north-west of the Hobart CBD and is a sub-regional shopping centre over two levels. The centre has a gross lettable area of approximately 19,316 sqm and features a Coles supermarket, Target discount department store, 61 specialty stores and 867 car parking spaces. The transaction is expected to settle around 30 September 2009.
Michael Gorman, CFX Fund Manager said: “The acquisition is consistent with our overall investment strategy of acquiring quality retail assets where we can add value through intensive asset management.” The acquisition will be fully debt funded through existing bank facilities and is expected to be accretive to earnings and distribution. It is expected that gearing will increase from 27.3% to approximately 28.0% which is comfortably within the Trust’s preferred range of 25-35%. Darren Steinberg, Head of Property said: “It is pleasing that we are in a position to acquire assets of this nature, where they are accretive and we are able to add value through our strong management platform.”
CFS Retail Property Trust (CFX) is a retail sector-specific Australian Real Estate Investment Trust (A-REIT) which invests in high quality regional and sub-regional shopping centres across Australia.