Centro adds to list of shopping centres July 1, 2008 Carolyn Cummins
CENTRO PROPERTIES has put up for sale more of its shopping centres, including some held in its syndicate vehicles, to reduce its debt mountain, a letter sent to investors yesterday said.
After closing the financial year as the worst performing property trust, with a fall in its security value of 97 per cent, the retail landlord is understood to have earmarked the assets in the Centro MCS 9 syndicate as the next for sale.
A change in management of the syndicate would require unit holder approval.
The MCS 9 syndicate has five shopping centres valued at a combined $308.95 million. They are: Centro Hollywood in South Australia, Centro Dianella in Western Australia, Raintrees Shopping Centre, Queensland, Hamilton Central, Victoria, and Centro Gympie, Queensland.
Last week sale documents were issued for four key properties - a 50 per cent unencumbered interest in Centro Galleria, Western Australia, Centro Colonnades, South Australia, and Centro Halls Head, WA, together with a freehold interest in Centro Bankstown, Sydney.
The portfolio has a value of $1.15 billion and is being marketed to public trusts and wealthy individuals.
The sales are part of Centro's strategic review aimed at raising cash to pay a first tranche of $2.3 billion of debt by December 15. As part of the deal Centro has until September 30 to satisfy its Australian financiers and US private placement noteholders that it is making good progress.
While a sale of any of the above assets either individually or as a portfolio is still in the planning stage, Centro's chief executive, Glenn Rufrano, says divestments to raise cash are his priority.
In the letter Mr Rufrano says the primary emphasis is to "effectively operate our underlying businesses, while providing liquidity to our balance sheet".
"We anticipate that marketing smaller pieces of the Centro Australian Wholesale Fund will attract more buyers with an ability to obtain debt financing. The recent extensions allow us the time to pursue these various options."
Ends.
Cheers, Pie :)
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