The price AMP Shopping Centre Fund is paying for The Palms Shopping Centre in Christchurch was a tightly held secret this week but NBR’s reliable sources suggest it was more than $200 million.
Before heading overseas for a well-earned break, Colliers agent Bill Leckie who brokered the deal winged his way into Christchurch to tidy up some details with The Palms owners. He also met The Palms property manager and leasing agent, Evan Harris of HG Livingstone, with whom he is understood to be negotiating another significant deal.
Mr Leckie and others involved in the deal said they had signed confidentiality agreements while the purchase was being scrutinised by the Overseas Investment Office (the AMP Shopping Centre Fund is managed by Sydney-based AMP Capital Investors). The acquisition will also see management company AMP Capital Shopping Centres assume the role of property and asset manager for The Palms.
Settlement is expected in late May.
The sale marks the maturity of The Palms as an investment for developers Max and Glen Percasky who secured the site and began seeking resource consents in 1992 ahead of its opening in 1996.
Since that time the propety has been refurbished and enlarged but it may have further development potential on upper levels.
It has become popular with shoppers from the north-eastern side of the city, which has seen some of the strongest growth in residential subdivisions recently.
The Percasky brothers played a hands-on role at the outset, even assisting on crowded days directing traffic.
Subsequently, they sold a half share to Tim Glasson and Warren Bell, and oversaw the enlargement of the mall and construction of a two-level car park. Glen Percasky told NBR this week that he had “loved every moment of it” and enjoyed being recognised by staff and customers.
He is focusing on his next project about a kilometre along Marshlands Rd from The Palms – a $30 million home base where a new Bunnings warehouse will be the anchor tenant (the centre will be leased and managed by Livingstones).
Meanwhile, The Palms will be the second shopping centre purchased by the AMP Shopping Centre Fund. Last September it bought a half share of the Bayfair shopping centre in Mt Maunganui from Tower Asset Management for $121.5 million, on a yield just under 5%. Bayfair is a regional shopping centre of 32,000sq m with turnover of more than $160 million.
By comparison, The Palms has a lettable area of 35,448sq m, 100 retail outlets, a cinema complex, 1450 car parking spaces, and a similar annual turnover.
The AMP Shopping Centre Fund has $1.8 billion in assets under management and comprises 10 properties including a half share of Bayfair in Tauranga and 25% of one of Australia’s largest shopping centres, Warringah Mall.
