EMBATTLED shopping centre owner and manager Centro believes this week's US capital markets turmoil has improved the group's chances of longer-term survival.
Centro chief executive Glenn Rufrano said yesterday that the US financial crisis had made the liquidation of Centro assets more difficult.
"If banks had been thinking about recoveries, it would be less likely today than last weekend," Mr Rufrano said.
Speaking after the $68 million sale of the group's Gold Coast Southport shopping centre and two more properties in New Zealand, Mr Rufrano said he did not know if banks owed $17.4 billion by Centro had been affected by the New York meltdown.
But he said the crisis clearly made any wind-up less likely.
Centro is less than two weeks away from a September 30 deadline, when it must convince lenders it is capable of implementing plans to recapitalise the group.
A second and more important deadline is December 15, when Centro is due to repay around $4 billion.
Mr Rufrano said yesterday that he had no reason to believe the banks would not extend the September deadline.
Centro previously flagged that it was unable to repay the money and would require its fifth major debt extension.
Mr Rufrano said that it was too early to say what was happening with Centro's US shopping centres.
But realistically, values had dropped this week, with less liquidity in the market triggering a likely freeze on major real estate asset trades for some time to come.
On Monday, Centro pulled the pin on attempts to sell a $US714 million ($881 million) portfolio after the contracted buyer attempted to renegotiate a lower price. Centro had similarly rejected a bid by Greg Karedis, of Theo's Liquor fame, to buy its Gold Coast Southport centre.
But yesterday the property, jointly owned by the Centro Wholesale Fund and Centro Retail Trust, was sold for $68 million to John van Liesholt's Brisbane Unison Projects group in Queensland's largest retail property transaction of 2008.
Across the Tasman, shopping centres in Auckland and Christchurch that were 100 per cent owned by the retail trust sold for $NZ49.9 million ($41.6 million).
The good news for Centro -- faced with a sell-down of a sizeable part of its $9 billion-plus Australian portfolio -- was that the Gold Coast property sold for only a 9.9 per cent discount to its June 30 book value, while the New Zealand properties, half of its NZ portfolio, were at a 1 per cent discount to their combined June 30 book values.
Centro also announced yesterday it had finalised the $47.69 million sale of Adelaide's Adelaide Central Carpark and Charles Street Plaza at a 3.85 per cent discount to book value.
The property, the sole asset of the Centro MCS 2 syndicate, was bought by local medico and property developer Dr Sam Shahin.
Jones Lang LaSalle's Simon Rooney brokered both sales.
CNP Price at posting:
7.7¢ Sentiment: Buy Disclosure: Held
