David Di Pilla’s HomeCo Daily Needs REIT is in advanced discussions to sell the McGraths Hill Home shopping centre in Sydney’s north-west for about $55 million to Stirling Property Funds, Street Talk can reveal.
A so-called daily needs centre, McGraths Hill counts Bunnings Warehouse and Harvey Norman as its anchor tenants. HomeCo owns a minority stake in the 16,479-square-metre asset and manages the investment on behalf of an investor consortium.
Sources say Stirling, helmed by a team that includes former Centuria Capital dealmakers, is yet to sign a deal with HomeCo. But that hasn’t stopped the would-be buyer from lining up equity backers to bed down the deal by November.
A fund-raising deck, seen by Street Talk, shows Stirling is seeking to raise $81 million for a new fund, which will house McGraths Hill and another similar asset – the Belconnen Convenience Retail Centre in north-west Canberra.
Belconnen is a stone’s throw from Elanor Investors Group’s schmick Capital Food Market and is tenanted by large retailers, including Chemist Warehouse, Petbarn and Barbeques Galore.
The new five-year fund is seeking initial investment commitments by August 22. A second capital call is slated for October. Debt funding has been secured from a “leading Australian bank”, the flyer says. Stirling is targeting a total return of 13 per cent and average cash distributions of 7 per cent.
Read the full story tomorrow and more on the Street Talk page.
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