Published 24 December 2007
Additional information from Stockland 27 December 2007
3 Auckland shopping centres will return to full New Zealand AMP ownership after 5 years.
AMP Capital Investors (NZ) Ltd sold 50% of the Botany Town Centre, LynnMall & the Manukau Supa Centa to the ASX-listed AMP Diversified Property Trust in 2002 for $188.1 million. AMP Diversified bought 50% of Botany for $98.3 million, Lynmall $65.2 million & Manukau $24.6 million.
After AMP’s diversified & shopping centre trusts came under attack from every other major listed property trust in Australia in 2003, Westfield Group took out the shopping centre trust and Stockland won control of the diversified trust, including the New Zealand interests.
AMP Capital Investors said today it had entered into conditional agreements for the AMP Property Portfolio to acquire Stockland’s 3 50% interests, currently owned by Trust Co Ltd for Stockland, for $368 million. The purchase is conditional on the approval of the Overseas Investment Office.
Settlement is scheduled to occur in 3 tranches on 31 March 2008, 30 April 2008 & 30 May 2008.
AMP Property Portfolio general manager Stephen Costley said the acquisition was part of a strategy to reweight the portfolio following the takeover of Capital Properties NZ Ltd in 2006. “The acquisition will move the diversified AMP Property Portfolio closer to its long-term sector benchmarks for retail & office properties.”
AMP Capital developed & opened Botany Town Centre in 2001. The 56,230m² centre is anchored by a Farmers department store & New World supermarket. Berkeley opened an 8-screen cinema complex in 2004. Consents have been obtained for 5500m² more retail space.
Mr Costley said AMP hoped to receive the last consent to add a further 400 parking spaces early in the new year, allowing the project to start mid-2008. The project, providing space for about 30 new retailers, is likely to be completed in 2 stages, concluding in the second quarter of 2009.
The AMP Society developed LynnMall in 1963. It’s been refurbished & expanded over time and is now 30,236m². It’s anchored by a Farmers department store & a Foodtown supermarket.
Jonmer Projects Ltd completed the 33,800m² large-format Manukau Supa Centa in 1998.
Additional information from Stockland
Stockland Retail chief executive John Schroder said in the company’s 24 December release it made the sale “as it looks at reinvestment opportunities in key strategic growth areas in Australia & the UK…. Demand for retail assets and the resulting cap rate compression meant that it was timely for us to pursue the sale of our interest in these centres and capitalise on other value-adding opportunities in the market to deliver improved future returns….
“The sale of our interest in these centres represents a total blended yield of 5.9% and has delivered a strong premium to book value.”
The New Zealand assets represented just over 7% of Stockland’s $A4.3 billion portfolio. Their book value in June was $A302 million and the sale price in $A was $322 million, giving a 6.6% premium on the value 6 months earlier.
Property details at Stockland’s June 2007 balance date, with book value & acquisition cost (including additions) given for Stockland’s 50%:
Book value $A173.7 millionCost $A98.5 millionValuation at June 2007 $A3086/m²Annual sales $NZ270.7 million4.1% of Stockland’s retail portfolioCap rate 6%Discount rate 9%Gross lettable area 56,287m²
Book value $A87.5 millionCost $A57.3 millionValuation $A2889/m²Annual sales $NZ196.9 million2% of portfolioCap rate 7%Discount rate 9.25%Gross lettable area 30,292m²
Book value $A40.8 millionCost $A27.7 millionValuation $A1208/m²Annual sales figure not given1% of portfolioCap rate 7.38%Discount rate 9.38%Gross lettable area 33,768m²
29 May 2003: Stockland launches full bid for AMP Diversified
29 May 2003: “Impact not material,” says AMP
Attribution: Company releases, story written by Bob Dey for this website.