cc is every sprooking

Centro centres on the block
Email Print Normal font Large font Advertisement Carolyn Cummins Commercial Property Editor
August 15, 2008

CENTRO Properties has put the rest of its US portfolio - 16 centres worth about $112 million - on the market as it works to raise cash before a September 30 deadline.

Yesterday was the cut-off date for potential buyers to register an interest in three of its centres owned by Centro Australia Wholesale Fund, worth about $430 million. These include Centro Galleria in Western Australia, which retail players said could interest CFS Retail Trust, possibly Lend Lease, or a private superannuation fund.

Centro has until September 30 to pay its Australian and US-based bankers and note-holders the first tranche of about $2.3 billion, after which all the bankers have agreed to roll over the remaining debt (about $4 billion) until December 15.

That date marks a full year since the group told investors it was in deep trouble with its financiers.

Issues of cross-ownership, management and pricing have been a deterrent to the other centres being offered in the Australian sales.

But in the US, demand appears stronger. Already the group has sold 29 of 31 of its US assets, raising $US714 million ($815 million) - 10 per cent below the book value. It has another 16 for sale.

The latest are being sold through the Pennsylvania real estate agency, NAI ReStore. They are valued at $US98 million.

Analysts said the sale looked to be the start of the divestment of the "SuperLLC" (a joint venture vehicle between Centro and Centro Retail Trust) assets.

Four of the properties are owned by Centro Retail Trust and the rest by Centro. It is expected the $US98 million asking price will translate into a sale at about $US90 million, with Centro getting about $US60 million and the rest going to Centro Retail Trust.

Centro reports its full-year results on August 29.


Carolyn Cummins Commercial Property Editor - LOL