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

• Release Date: 02/09/15 09:54
• Summary: ASSET: KPG: Acquisition of large format retail development
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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