Westfield Trust to acquire remaining 50% of Westfield Shoppingtowns Parramatta and Liverpool

16 September 1999

Countries: Australia

Westfield Trust today announced that it had reached anin-principle agreement to acquire the remaining 50% interests inWestfield Shoppingtowns Parramatta and Liverpool (both in Sydney)from joint venture partner Rodamco for $A530 million.

The acquisitions follow Rodamco’s announcement earlier this yearof its intention to divest itself of its interests in the twoShoppingtowns as part of a major corporate re-organisation.

The acquisition, which is subject to the finalisation of legaldocumentation, is expected to be concluded within two months.

The Trust today also announced an equity issue of $A366 millionthrough the placement of 119.6 million units to institutionalinvestors at a price of $A3.06.

The proceeds of the issue, which has been underwritten byWarburg Dillon Read, are intended to be used to fund theacquisitions with the balance of the monies coming from the Trust’sdebt facilities.

This would result in the Trust’s total assets increasing to $6.4billion with a gearing level remaining at approximately 23%.

Westfield managing director Steven Lowy said he was very pleasedto have reached agreement with Rodamco for the purchase of the twoproperties which will further strengthen the Westfield Trustportfolio.

“These two centres are already strong performers and areexpected to benefit significantly as a result of projected growthand public and private sector investment in their respectivelocations,” Mr Lowy said.

The purchase price for the 50% interest in Parramatta of $A370million represents an initial yield of 6.9% and the purchase pricefor the 50% interest in Liverpool of $A160 million represents aninitial yield of 7.4%. These purchases reflect the premium qualityof these assets that are forecast to produce sound income andcapital growth.

Parramatta Shoppingtown is Australia’s top ranking shoppingcentre with $565 million in retail sales and a 7% increase inspecialty store turnover recorded in the past year.

With five levels of retail space covering a gross lettable area(GLA) of 128,800sqm Parramatta is also Australia’s largest shoppingcentre.

The centre is strategically located in the demographic andgeographic heart of Sydney, the Parramatta CBD, approximately 23 kmwest of the Sydney CBD.

This area has been targeted for major redevelopment andinvestment by the NSW State Government as the focus of itspost-Olympic construction strategy. The strategy, which is expectedto include the relocation of State Government departments toParramatta, will boost employment growth in the area.

Parramatta Shoppingtown is ideally placed to serve the area’sgrowing population, with its offer of two department stores (GraceBros and David Jones), two discount department stores (Target andKMart), three supermarkets (Franklins Fresh, Woolworths and a ColesExpress), a Village 8 cinema complex, Rebel Sports, Toys ‘R Us and360 specialty stores.

Liverpool Shoppingtown is another strong performer in theWestfield Trust portfolio, with sales of $285 million as at July1999, led by specialty store sales which increased by 4% in thelast year.

The centre is strategically located in the CBD of Liverpool, about32km south west of central Sydney – in the heart of Sydney’srapidly expanding southwest growth corridor which has a populationgrowth forecast of 2.0% per annum for the next 10 years, twice theAustralian average growth rate of 1.0% per annum.

Liverpool Shoppingtown incorporates a Grace Bros department store,a Target discount department store, Woolworths and Franklinssupermarkets, a Greater Union 12 cinema complex, Toys ‘R Us and 210specialty stores.

Both centres have historically generated strong income andcapital growth and have maintained high occupancy levels in excessof 99.5%.
As a result of these transactions the expected distribution growthfor 1999 remains unchanged and distribution growth prospects for2000 and beyond remain positive.

Fact sheet :
Westfield Shoppingtown Parramatta

Centre Opened 1975
Developments 1988 and 1995
Location 23 km west of the Sydney CBD
GLA 128,800 m2
Major Retailers Grace Bros, David Jones, Kmart, Target, Woolworths,Franklins Fresh, Coles Express, Toys R Us, Rebel Sports, Best &Less and Village 8 Cinemas
Number of Specialty Shops 360
Car Spaces 4,500
Price (50% basis) $370 million
Initial Yield (after acquisition costs) 6.9%
Annual Sales (as at July 1999) $565.7 million

Fact sheet :
Westfield Shoppingtown Liverpool

Centre Opened 1972
Developments 1991 and 1992
Cinema redevelopment in 1996
Location 32 km south west of the Sydney CBD
GLA 68,752 m2
Major Retailers Grace Bros, Target, Woolworths, Franklins, Toys RUs, Best & Less and Greater Union 12 Cinemas
Number of Specialty Shops 210
Car Spaces 2,700
Price (50% basis) $160 million
Initial Yield (after acquisition costs) 7.4%
Annual Sales (as at July 1999) $285 million