Vicinity Centres (Vicinity) and GIC today announced they had settled the exchange of a 49% interest in Vicinity’s Chatswood Chase Sydney for AUD562.3 million, for 50% interests in GIC’s Queen Victoria Building (QVB), The Galeries and The Strand Arcade (collectively the Sydney CBD Centres) for AUD556.0 million.
From today, Vicinity and GIC will be co-owners of the assets and Vicinity will assume property management of the Sydney CBD Centres, and will continue to manage Chatswood Chase Sydney.
Vicinity Centres CEO and Managing Director, Grant Kelley welcomed QVB, The Galeries and The Strand Arcade’s 311 retailers to Vicinity’s portfolio of 80 shopping centres. “Vicinity is delighted to have become joint owner with GIC of these premium Sydney retail destinations.
“These iconic, high quality and strongly performing CBD centres, together attract approximately 60 million visitors annually,” Mr Kelley said.
“We look forward to working with our new retail partners and seeing them benefit from growing consumer traffic including tourists and from improvements to surrounding transport infrastructure.”
Mr Kelley said the deal expanded Vicinity’s national premium and CBD retail portfolio which includes flagship centres such as Emporium Melbourne and Chadstone both in Melbourne, The Myer Centre Brisbane and QueensPlaza both in Brisbane, as well as Chatswood Chase Sydney.
“This transaction means we now have an unparalleled premium retail offer across Australia’s three largest CBDs – Sydney, Melbourne and Brisbane,” Mr Kelley said.
Mr Kelley praised GIC and its team for the strong performance and management of the Sydney CBD Centres and said Vicinity’s immediate focus would be on a smooth management transition.
“Our focus will be on working closely with centre teams on operations, getting to know our new retailers and their businesses, as well as targeting ongoing growth through active remixing.”
Mr Kelley said the deal further extended Vicinity’s strong relationship with GIC which also included Myer Bourke Street and Emporium Melbourne.
“Importantly, the Sydney CBD Centres offer our new and existing retail partners an even greater opportunity across our national portfolio of centres,” Mr Kelley added.
The Sydney CBD Centres’ trade area continues to grow and includes three large, diverse and growing consumer groups, 337,500 workers (with annual growth of +1.3%), 3.2 million residents (+1.4%), 33 million tourists (+6.9%), as well as a high volume of commuter traffic.
The Sydney CBD will be enhanced in the coming years due to infrastructure projects currently under development, improving consumer flow in and around the Sydney CBD Centres.
The light rail opening in 2019 will improve the amenity and access along George Street, with a stop adjacent to QVB, and the new Sydney Metro (opening in 2024) will improve access into the CBD from Sydney’s south-west and north-west, with the new Pitt Street station entrance adjacent to The Galeries.
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