The Directors of BWP Management Limited, the responsible entity for the BWP Trust (BWP), announced an agreement for the Trust to acquire a 50 per cent interest in the Domain Central homemaker centre in Townsville, Queensland for a purchase price of $61.5 million. The purchase price is supported by an independent valuation of the property and reflects a capitalisation rate of 9.0 per cent. Under the agreement, the current owner, which has extensive experience in owning and managing bulky goods properties, will retain a 50 per cent interest in the property and a company related to the current owner will continue to manage the property. The agreement to acquire the property is subject to conditions precedent relating to refinancing by the current owner, the outcome of which is expected to be determined prior to the end of the 2011 calendar year. Settlement will take place shortly after the satisfaction of the conditions precedent and will be funded from the Trust’s existing and new finance facilities. The acquisition is forecast to be accretive to the Trust’s earnings and distributions from settlement. Information on Domain Central
The property, located approximately six kilometres south-west of the Townsville central business district, comprises a modern single level homemaker centre, constructed over several stages between 2005 and 2007. The gross lettable area of 48,797 square metres covers approximately 40 per cent of the 12.3 hectare site. The centre has a weighted average lease expiry of 3.9 years and comprises 65 tenancies with retailers including JB Hi-Fi, Dick Smith, Freedom Furniture and Nick Scali. National and chain retailers account for approximately 88 per cent of the lettable area and approximately 90 per cent of these national and chain retailers are company owned, with the balance being franchised stores. The centre has less than one per cent vacancy.
Domain Central forms part of an integrated homemaker precinct, which includes a freestanding Bunnings Warehouse and Harvey Norman immediately adjoining the property, and a Spotlight and Anaconda homemaker complex situated directly opposite the property. BWP Trust investment strategy BWP’s main aim is to provide unitholders with a secure and growing income stream and long-term capital growth. To achieve this objective, in addition to acquiring Bunnings Warehouses, BWP will consider appropriately priced quality non-Bunnings properties offering accretive yields.