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Scentre Group (ASX: SCG) has reached a deal to sell a 25 per cent stake in Westfield Chermside, Queensland's largest shopping centre and the third-largest in the country, to Dexus Wholesale Shopping Centre Fund (DWSF) for $683 million.
As part of the deal, DWSF will join Scentre Group as a joint venture partner for the property, with the latter continuing its responsibility as property, leasing and development manager.
The purchase price is proportionate to Scentre Group’s book value for the property at 30 June 2025 and a valuation capitalisation rate of 5 per cent.
"We are pleased to introduce DWSF as our new joint venture partner at Westfield Chermside. Sourcing new capital through joint ventures continues to form a key part of the Group’s capital management strategy," says Scentre Group CEO Elliott Rusanow.
"Since the start of the COVID-19 pandemic, the Group has been successful in sourcing funding through innovative and various sources, without diluting securityholder equity. Today’s announcement is another step in the Group’s long term funding strategy.
"The proceeds from this transaction will provide the Group with further capital to pursue our strategic objectives of creating long term value for securityholders."
DWSF is the flagship retail fund of Dexus (ASX: DXS), which claims the acquisition aligns with the fund's strategy of owning market-leading retail assets with strong growth potential.
"This exclusive off-market transaction leverages our established relationship with Scentre Group to secure a market-leading asset for DWSF," says Dexus executive general manager for funds management, Michael Sheffield.
"Dexus’s co-investment underscores its conviction in the fund’s strategy and future potential."
"Westfield Chermside's scale, performance metrics and community integration make it an exceptional addition to our retail platform, delivering both immediate performance and long-term value creation," adds Dexus executive general manager for retail, Kirrily Lord.
Dexus plans to invest an additional $170 million into the fund, taking its investment to $300 million, as it also supports further initiatives to ensure the fund maintains investor appeal and performance. These include changes to the fee structure, fund liquidity and backstop funding in relation to the sale of the Macquarie Centre.
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