Westfield Group yesterday sold off a 50 per cent stake in the Merry Hill shopping centre at Dudley in a deal worth #524 million.
The stake, which also includes development land surrounding the hugely popular centre, has been acquired by Australian fund manager Queensland Investment Corporation.
The deal sees Westfield form a new joint venture with Queensland Investment, one of Australian's largest institutional fund managers, in respect of Merry Hill.
However, Westfield will retain control of leasing and development of the centre, at 150,000 sq metres in size one of the largest shopping malls in the UK, featuring stores such as Debenhams and Marks & Spencer, Asda and Sainsbury supermarkets and over 250 specialty stores, plus 8,000 car spaces.
Steven Lowy, Westfield group managing director, said: "This announcement continues the group’s capital initiatives, raising equity capital for reinvestment in our global redevelopment programme."
He added: "We are very pleased to have formed this joint venture with QIC in the UK. The group has enjoyed a long and successful relationship with QIC at Helensvale in Australia and we look forward to the international extension of this relationship."
The Westfield Group purchased its 100 per cent interest in Merry Hill as part of its Chelsfield/Duelguide acquisition in December 2004 at a cost of #875 million.
Westfield has approximately #23 billion of assets under management in a portfolio of 121 shopping centres in the UK, United States, Australia, and New Zealand. Its portfolio amounts to more than 10 million sq metres of retail space and houses more than 22,000 retailers. The group employs more than 4,000 staff worldwide.
In Britain, Westfield owns other shopping centres at Derby, Guildford, Tunbridge Wells, Nottingham, Belfast and Lisburn.
In addition to these it has three development projects, two in London – at White City and Stratford – and one in Bradford, West Yorkshire.
Projects under construction include the landmark #1.6 billion Westfield London shopping centre at White City, which, on opening in 2008, will be the largest shopping centre in greater London with 150,000 sq metres of mixed use space.
Also under extensive reconstruction is the #340 million Derby Eagle Centre, Westfield’s first UK development, due to open in late 2007.
Westfield wants more joint ventures to help raise capital for its A$6.9 billion (#2.76 billion) developments.
Matt Hoult, at ABN Amro Asset Management in Sydney, said: "They still have at least A$12 billion (#4.8 billion) of capacity they can raise by hiving off assets and selling off the bits where they own more than 50 per cent.''