Vicinity Centres and Singapore’s GIC in $1.1bn Sydney retail asset swap

Retail property firm Vicinity Centres has agreed to swap stakes in prime Sydney retail real estate with GIC, Singapore’s sovereign wealth investment fund.

Vicinity will exchange a 49% stake in its Chatswood Chase Sydney worth AU$562.3mn, for a 50% stake in GIC’s Queen Victoria Building, The Galeries and The Strand Arcade, worth AU$556mn.

The Australian company will now be responsible for the operation of both sets of assets, expanding its footprint in the Sydney retail space.

Angus McNaughton, CEO and Managing Director at Vicinity, said: “This transaction is strategically significant for Vicinity. We gain exposure to, and the management rights of, three high quality and strongly performing CBD centres in Sydney, Australia’s most populous and most visited CBD. This transaction also expands our strong relationship with GIC.”

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The Sydney CBD Centres are prime assets in GIC’s Ipoh portfolio since 2003. Under Ipoh’s property management, GIC has completed several significant asset enhancements including refurbishments, re-developments and tenant re-leasing projects.

Chatswood Chase Sydney is a premium, high-performing Major Regional shopping centre situated in one of Australia’s most affluent catchments on Sydney’s North Shore, with more than 11mn consumer visits annually.

This transaction is expected to conclude in early 2018, subject to approvals by Sydney City Council, RailCorp and the Foreign Investment Review Board.