KPG kiwi property group limited

Ann: ASSET: KPG: Acquisition of large format retail development

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    • Release Date: 02/09/15 09:54
    • Summary: ASSET: KPG: Acquisition of large format retail development
    • Price Sensitive: No
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    					KPG
    02/09/2015 09:54
    ASSET
    PRICE SENSITIVE
    REL: 0954 HRS Kiwi Property Group Limited
    
    ASSET: KPG: Acquisition of large format retail development
    
    Kiwi Property has today secured the acquisition of a large format retail
    centre currently under development at Westgate, in Auckland's north-west, for
    $82.5 million.
    
    Westgate is a comprehensively planned town centre development, located at the
    intersection of State Highway 16 and State Highway 18, which provides for new
    and existing retail, commercial, service and housing development.
    
    The large format retail development, known as Zone 7, is anchored by Harvey
    Norman, Briscoes, Rebel Sport, Freedom Furniture and Hunter Furniture and
    comprises 28 retail units totalling approximately 25,500 sqm, with a central
    car parking area for 622 vehicles.
    
    The development is 87% pre-committed with lease agreements in place for
    22,200 sqm of retail space and a weighted average lease term of 8.1 years.
    
    The centre is being developed by New Zealand Retail Property Group and sits
    on a predominantly freehold site of 5.1 hectares.  A small portion of the
    land, 6.3% by area, is subject to a ground lease.
    
    Chris Gudgeon, Chief Executive of Kiwi Property, said: "This acquisition
    follows our purchase in December last year of the former Apex Mega Centre at
    Sylvia Park - another high quality large format retail centre. The Westgate
    complex provides us with further exposure to large format retail space, which
    we see as an attractive sector in key locations."
    
    "The acquisition cost of $82.5 million represents a yield on passing rent of
    7.0%, and we are targeting a 10-year internal rate of return of approximately
    9.1%," Mr Gudgeon said.
    
    "This acquisition is consistent with our strategy of growing our Auckland
    retail sector exposure, specifically in dominant regional centres and large
    format retail locations favoured by the Proposed Auckland Unitary Plan.
    Westgate is a Metropolitan Centre under the Unitary Plan and we believe it
    will emerge as one of Auckland's favoured retail destinations, particularly
    for large format retail, with very positive attributes in terms of population
    growth, household formation and motorway accessibility."
    
    The centre is currently under construction with the initial stages expected
    to commence trading in March 2016.  The acquisition will be funded through
    existing debt facilities.  Title for the land will be secured with an initial
    payment of $30 million, with the balance to be paid over the remaining
    development period.
    
    > Ends
    
    Contact us for further information
    
    Chris Gudgeon
    Chief Executive
    [email protected]
    +64 9 359 4011
    mobile +64 21 855 907
    
    Mathew Chandler
    Investor Relations and Communications Manager
    [email protected]
    +61 458 110 042
    
    About us
    
    Kiwi Property (NZX: KPG) is the largest listed property company on the New
    Zealand Stock Exchange and is a member of the NZX15 Index.  We've been around
    for more than 20 years and we proudly own and manage a $2.3 billion portfolio
    of real estate, comprising some of New Zealand's best shopping centres and
    prime office buildings.  Our objective is to provide investors with a
    reliable investment in New Zealand property by targeting superior
    risk-adjusted returns over time through the ownership and active management
    of a diversified, high-quality portfolio.  To find out more, visit our
    website kp.co.nz
    End CA:00269509 For:KPG    Type:ASSET      Time:2015-09-02 09:54:31
    				
 
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