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Kiwi Income agrees to buy LynnMall for $174 mln

Kiwi Income agrees to buy LynnMall for $174 mln from AMP Capital

Dec. 2 (BusinessDesk) - Kiwi Income Property Trust has agreed to buy Auckland’s LynnMall Shopping Centre from AMP Capital Property for $174 million.

The deal is subject of Overseas Investment Office approval. Kiwi Income’s manager is owned by Australia’s Colonial First State Global Asset Management.

Buying LynnMall will lift the Trust’s retail sector weighting from to 63% from 60% and increase its weighting to Auckland to 53% from 48%, it said in a statement. The acquisition will be funded from existing bank debt facilities, lifting the trust’s net bank debt gearing ratio by 6% to about 31%.

Lynmall will provide a long-term yield of 8.41%. The deal is aimed to settle on Dec. 31.

The 30,661 square metre mall in the Auckland suburb of New Lynn has tenants including Farmers, Countdown, JB Hi-Fi, Number One Shoes, Noel Leeming and Postie Plus. The centre is currently 99.6% occupied.

“The acquisition will be immediately accretive to earnings and assists us in meeting our objective of maintaining attractive long-term sustainable returns to investors,” said Darren Steinberg, managing director of property at Colonial First State Global Asset Management.

The trust’s units traded unchanged at $1 on the NZX yesterday and have declined about 6% this year.

(BusinessDesk)

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