BILLIONAIRES Bob Ell and John Van Lieshout are believed to be in a head-to-head contest to buy the $200 million Centro Surfers Paradise shopping centre, the largest asset to be placed on the market in almost three years by its debt-laden owner.
Centro Properties Group has settled sales for $195m worth of Australian malls since January.
The Surfers Paradise centre has been on the market since March. Industry sources say it has attracted offers on yields of between 8.25 per cent and 8.5 per cent.
Mr Van Lieshout's Unison and Mr Ell's $3.1 billion Sydney-based Leda Holdings are believed to be the two private investors shortlisted to buy the property.
Queensland-based Mr Van Lieshout founded the Super A-Mart furniture chain, which he sold four years ago for $500m, while Leda chairman and founder Mr Ell was listed last month in the BRW Rich List as having a fortune worth $1.1bn.
Both parties declined to comment yesterday. Centro also did not comment on the property.
The Centro Surfers Paradise shopping centre was last valued at $202m, down $25.5m from 2007. It is being sold after its owner, the Centro Properties Group-managed syndicate, Centro MCS 11, unsuccessfully tried to raise fresh equity.
The negotiations precede an announcement, expected within weeks, on a restructure proposal for Centro Properties Group and its sister company Centro Retail.
There has been speculation that advisers may recommend that Centro's Australian-based $3.12bn MCS Syndicate business be sold separately.
The restructure of Centro Properties is being led by advisers Moelis and JPMorgan, while Centro Retail Trust is being advised by UBS.
A year after the group nearly collapsed, a deal was struck between Centro and its bankers that saw the financiers effectively take ownership of the business until it could be broken up and sold.
In December 2007, Centro told the market it was unable to refinance $4bn worth of debt, and its Surfers Paradise shopping centre is the largest asset listed for sale since then.
Leda Holdings is the co-owner of Centro Tuggeranong in Canberra and Centro Hervey Bay in Queensland. It is believed recent attempts to offload the Hervey Bay asset to listed property trust Stockland for $70m have stalled.
This year Centro has settled sales on its David Jones centre in Perth ($114.5m); the Koala Tavern in Capalaba, Queensland ($8m); Centro Murray Bridge in South Australia ($21.75m); Centro Nerang, Queensland, half-owned by Centro Retail ($38.5m); and Centro Meadow Heights, Melbourne ($12.3m).
Sources say potential buyers for Centro Surfers Paradise on Cavill Avenue's Cavill Mall could be deterred by the limited expansion opportunities for the property. Centro Surfers Paradise, with more than 120 specialty shops, is being marketed by Jones Lang LaSalle's Simon Rooney and is among more than $2bn worth of shopping centres struggling to find buyers.
Retail property owners are holding tightly to quality assets and many of those on offer are being shunned by listed trusts and major institutions. There are at least four major retail assets that have been on the market since the start of this year. The $1.5bn Direct Factory Outlets retail chain, owned by Melbourne-based Austexx, was offered for sale in February, and according to sources the business -- believed to owe about $1bn to its financiers -- has not yet found a taker for a price that covers the debt.
Three parties have been named as showing interest, including British-based Pradera Asset Management, and consortiums led by Lend Lease and Colonial First State. Elsewhere, the Top Ryde shopping centre in Sydney is also awaiting sale. Buyers are believed to have shunned a half share of the $600m centre.
Meanwhile, Sam McVay of McVay Real Estate declined to comment on speculation that the Birkenhead Point Shopping Centre in Drummoyne in Sydney was under exclusive due diligence. Its asking price is about $200m.
The $90m Gold Coast Marina Mirage is also yet to sell.
CNP Price at posting:
18.5¢ Sentiment: LT Buy Disclosure: Held
