GIC takes major hit on Sydney mall stake

Chatswood Chase is set for a $620 million refurbishment.

Vicinity Centres has bought back the 49 per cent interest it sold six years ago in Sydney’s Chatswood Chase, with plans for a major revamp.

Vicinity has just sold Roxburgh Village to JY Group.

The $307 million price is a dramatic drop on the $562.3m vendor, Singapore sovereign wealth fund GIC, paid as part of a real estate swap deal – months after a property cycle peak.

It is however well over the June 30 valuation, appraising the asset at $670m assuming a 5.5 per cent capitalisation rate.

Also today, we are reporting Vicinity selling Roxburgh Village, in Melbourne’s north Roxburgh Park, to JY Group for $123m.

Price above valuation

On Sydney’s Lower North Shore – and with a 450,000 person catchment – Chatswood Chase is considered a premium centre, with over 10 million consumer visits a year.

Developed in 1980, it was acquired in two parts by Vicinity – in 2003 and 2007 – which manages it and is behind the last renovation, in 2009.

Anchored to Coles, Kmart and David Jones, it has a gross area of 64,465 square metres.

However, more than three quarters (78pc) of area tenanted to c125 specialty stores expire this financial year (story continues below).

There are also 2434 car parks.

Lux refurb planned

Upon settlement mid-March, a c$620m luxury focused redevelopment is planned, expected to take some 18 months to complete.

Forty five per cent of proposed space is pre-committed, the buyer said.

The end value of the asset then should circle $1.5 billion.

Chatswood is 11 kilometres north west of Sydney’s CBD.

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Marc Pallisco

A former property analyst and print journalist, Marc is the publisher of