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SYDNEY - Westfield Group will sell half of an Australian mall, capping US$7.5 billion ($10.6 billion) of securities and asset sales in eight months to fund expansion of the world's biggest portfolio of shopping centres.
A unit of Jones Lang LaSalle, the world's second-largest commercial real estate broker, will invest A$738 million ($859 million) to help redevelop the Doncaster shopping mall in Melbourne by the end of 2008.
Westfield's sales of stakes in Australian and UK malls this year let the company cut funding costs by tapping equity in the more than A$60 billion of retail centers it manages.
Managing Director Peter Lowy in June said Westfield has more than A$14 billion of projects planned or already under construction.
"The latest deal further strengthens Westfield's balance sheet and is accretive as well given the group can pay down Australian debt at rates above 6 per cent with funds that are effectively being raised at 4.7 per cent," Simon Scott, an analyst at Goldman Sachs JBWere, said.
Doncaster will now be owned by a venture between Westfield and LaSalle Investment Management, a unit of Jones Lang LaSalle, which supervises more than US$44 billion of property assets worldwide for institutional and individual investors.
Such deals allow the world's biggest shopping centre owner by market value to retain oversight and management fees for centres such as Doncaster and the Merry Hill mall in the UK's West Midlands region.
Westfield also sold A$3 billion of shares in June, after raising A$1.25 billion over the previous six months by selling property-linked notes to investors.
-Bloomberg
