Stockland Group (ASX: SGP) today announced the unconditional sale of two retail assets for $143 million.
Stockland’s Brisbane Sale
The two assets being sold are the Stockland Cleveland shopping centre located in Brisbane and the Toowong retail and commercial centre in Brisbane’s southern suburbs. The sale price of $143 million is a 2.9% premium to the combined book value of both assets.
More Sales To Come
Managing Director Mark Steinhert, said, “These transactions take our total asset sales for the current financial year to $256.1 million, representing 64 per cent of our target $400 million of divestments already achieved within the first nine months of the stated 24 month time frame.”
Mr Steinert said it was part of Stockland’s strategy to divest non-core assets as they “focus on recycling capital where expected internal rates of return for divested assets are below our investment hurdle rates”.
Strengthened Balance Sheet
With both transactions expected to settle before the end of the financial year, investors can expect a strengthened balance sheet from the surplus cash. Apart from additional cash, Mr Steinhert said the proceeds will, “be reinvested into our workplace and logistics development pipeline and our securities buyback. It also gives us the flexibility to invest in other opportunities with strong risk-adjusted returns above our hurdle rates”.
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