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seldown places 120m regional cent under cloud

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    October 25, 2008 07:03am

    Selldown places $120m regional centre under cloud

    THE Centro Property Group is poised to pull out of the Nerang retail market, laying plans to divest a major holding.

    The company's Centro Nerang shopping centre has been listed for sale in an expression of interest campaign handled by Colin Peet and Peter Tyson, of Savills, and closing on November 7.

    A group spokesman said the sale was part of an asset selldown to ease an overall debt burden near $8 billion.

    The spokesman said the sale price would need to reflect good value for shareholders.

    Centro Nerang opened as Nerang River Plaza in 1983 and is a 10,013sqm neighbourhood centre with Coles and Aldi supermarkets, almost 50 specialty shops and 543 on-grade parking spaces.

    It sits on a 4.22ha holding, at 65 Station Street, acquired for $21 million in 1998.

    Fully leased, the centre returns annual net income of around $3.4 million.

    Under a development and management agreement between Centro and Sydney-based Ticor Developments the centre and an 11.63ha Ticor-owned adjoining parcel had been earmarked for a $120 million regional centre.

    Expansion was to occur mainly on Ticor's property, immediately southwest of Centro Nerang, while Centro was to manage the facility -- a shopping and leisure destination with more than 42,000sqm of floorspace, including cinema complex, food court and office precinct.

    Ticor received Gold Coast City Council approval for the project last month.

    According to Ticor, the centre would be reborn as a 'world class retailing precinct' and deliver a true town centre to Nerang's business district.

    The centre would inject an additional 32,000sqm of lettable retail space, including an eight-screen cinema complex, as well as about 4000sqm of office space.

    The additional retail space would accommodate a discount department store, a third supermarket, four mini-majors, food court, fresh food market, and specialty shops including kiosks and street-facing retail outlets.

    Access to the adjoining Nerang River would be improved, with the riverbank to gain a landscaped walkway.

    Also, the food court would be oriented towards the river -- the first such precinct in Nerang.

    There would be parking for almost 2100 vehicles, with 1500 at basement level and 550 on grade.

    Ticor, which is progressing a $40 million upgrade at the Marina Mirage shopping centre on the Southport Spit, was to finance construction of the new shopping centre.

    Ticor Properties director Tim Atkins said the Nerang parcel was not the subject of a public sales campaign.

    However, he neither confirmed or denied that the parcel could be the subject of an offmarket deal.

    Ticor bought its largely vacant Nerang property from Dudley Roessler at a cost of $20.75 million in April, 2007.

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