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DEXUS Property Group (DXS) said it has acquired Centrewest Industrial Estate in Silverwater, NSW, for $24.43 million, with an initial passing yield of 9.7% and a weighted average lease expiry by income of 3.8 years. The group said the estate is located adjacent to its existing estate at Egerton Street.

Dexus said the property has a total Gross Lettable Area of 17,838 metres squared with large units fronting Silverwater Road and smaller industrial units located at the rear of the estate.

Head of Industrial at Dexus, Andrew Whiteside, said the acquisition further diversifies and expands the group’s industrial portfolio, consistent with its strategy to invest in quality properties in key locations to deliver quality products for tenants and drive further value for the group.

“This property acquisition allows us to increase our presence in the inner west Sydney market and given the location, adjacent to our existing holding at Egerton Street, enables us to reposition both properties in the future to create a combined estate of over $64 million with a WALE of over four year and a total GLA of 47,164 metres squared,” Mr Whiteside said.

The group’s industrial portfolio has $1.5 billion under management.

As at 1106 AEST, Dexus shares were up 1.5c to 79.5c.

Westfield Group (WDC) said it was ready to emerge from the global economic downturn this year and in the future, with pre-development activity starting on around $10 billion worth of new shopping centres. At the group's first quarter review, Westfield said that, as an ongoing benchmark, it was targeting between $500 million and $1 billion worth of development annually.

Westfield also provided evidence of the economic recovery, with sales in Australia, where it owns 44 shopping centres, up 2.1% in the year to 31 March and 2% for the March quarter, when compared to the previous corresponding period.

The real driver however was the film industry, with cinemas contributing 22% more in the March quarter over the previous corresponding period.

Other sectors weren’t as strong, with both jewellery and leisure spending in Westfield shopping centres down 1.2% in the March quarter.

In the important US sector, where Westfield has 55 centres, sales per square foot pointed to the strength of the economic recovery.

Despite year-to-date being almost across the board lower, in the three months to 31 March 2010 sales grew strongly. Spending on leisure was 14% higher than the previous corresponding period.

Jewellery, fashion and cinema spending rose 5.9%, 4.4% and 12.8% respectively in the quarter.

At the close Monday, Westfield shares were trading at $13.13.

Commonwealth Property Office Fund (CPA) manager, Colonial First State Property Limited, announced a 4.8% upgrade to the fund’s distribution guidance for FY10. The fund said the upgrade has been driven primarily as a consequence of the underlying portfolio performing better than forecast.

The primary reason for the upgrade was combined with savings in interest costs associated with the termination of interest rate swaps and the delay in settlement of the acquisition of 58 Mounts Bay Road, Perth, from May 2010 to June 2010.

Colonial First said the distribution guidance for FY10 has increased from 5.3c per unit to 5.55c per unit.

This, the company said, equates to 2.90 cents per unit for the six months ending 30 June 2010.

Head of Property for Colonial First State Global Asset Management, Darren Steinberg, said CPA’s guidance upgrade is the result of the fund’s active asset and capital management strategies, coupled with improving conditions in Australia’s office markets.

As at 1120 AEST, Commonwealth Property Office Fund shares were up 0.5c to 93.5c.

Westpac Office Trust (WOT) recommended shareholders accept Mirvac Group’s (MGR) offer to buy all the shares in WOT. Mirvac offered 0.597 of its own shares for every one WOT unit held or 0.597 Mirvac Instalment Receipts (IR) for every one WOT IR held, valued at 86c per WOT unit.

There is also a cash option of 86c per WOT unit up to an aggregate cash component of $200 million.

As at 1123 AEST, Westpac Office Trust shares were up 3c to 85c, while Mirvac shares were down 2c to $1.415.

Westpac Funds Management Limited (WFML), the responsible entity of WOT, said it has entered into a Scheme Implementation Agreement with Mirvac in relation to the offer.

“The Independent Directors of WFML unanimously recommend the Offer in the absence of a superior proposal and subject to an independent expert concluding that the Offer is fair and reasonable and in the best interests of WOT Investors,” Westpac Office Trust said in a statement.

The proposal is for the offer to be implemented by way of a trust scheme which would require WOT investor approval and which, if implemented, would result in WOT becoming a wholly owned sub-trust of Mirvac Property Trust.

Westpac Office Trust said shareholders would be invited to vote on the offer at a meeting expected to be held on or about 13 July 2010.

Mirvac said it believes the combination of WOT and Mirvac’s portfolios would create a stronger and more diversified property investment portfolio, benefiting both existing and new Mirvac shareholders.

”The proposed transaction is expected to deliver 3% earnings accretion to Mirvac Property Trust in the financial year ending 2011 and expands Mirvac’s ownership of Australian investment grade assets by an additional $1.1 billion,” the group said.

Australand Property Group (ALZ) has entered into the first part of a contract with the Port of Brisbane Corporation that could eventually see the company build as many as 1,000 homes. The group said the contract is for the purchase of a 1.8 hectare fully serviced land parcel at the Northshore Hamilton site, fronting the Brisbane River, for an upfront payment of $11.1 million and a share of revenues through the life of the project.

Australand said the site is zoned residential and would initially deliver around 150 homes with profit contribution expected from FY12.

The group also secured options to acquire the remaining 4.5 hectares of the site, in stages, which have the potential to deliver a further 850 homes.

Australand’s executive general manager – Residential, Rod Fehring, said the site is an illustration of the group’s strategy to selectively target urban infill sites that would deliver both increased densities and superior levels of public and private amenity.

Australand said the site is about seven kilometres from the Brisbane CBD, bordered by the recently developed 2.5 hectare Northshore Riverside Park.

The company plans to develop the site with a diverse product range of apartments, attached and detached homes, with construction expected to commence in 2011 and a marketing campaign for the first stage of the project due to commence in September 2010.

As at 1142 AEST, Australand shares were up 0.5c to 56.5c.

GPT Group (GPT) announced an equity raising of about $400 million for the GPT Wholesale Office Fund. The group said it sees this as the right time to raise equity given the stabilisation of real estate pricing and the current demand levels from investors for quality Australian office assets.

Head of Wholesale for GPT, Nicholas Harris, said the capital raising would strengthen the Fund’s balance sheet and increase its capacity to capitalise on future opportunities at a cyclical low point in the cycle.

“This is a unique opportunity for investors to participate in a new equity raising in the highest quality office fund in the country,” Mr Harris said.

”We see this raising as offering an attractive opportunity for our existing, and potentially new investors to acquire an interest in the Fund at the current Net Asset Value.”

GPT said the proceeds from the raising would be used to retire debt and strengthen the Fund’s balance sheet, in line with the Fund’s capital management objectives.

The group said as at 31 March 2010 GWOF had gearing of approximately 22% and more than $250 million in undrawn facilities.

As at 1325 AEDT, GPT shares were up 0.5c to 58.5c.

Mirvac Group (MGR) announced the successful completion of its $350 million Institutional Placement announced yesterday. The group said as a result it is now well positioned to fast track its existing commercial and residential development pipelines, and take advantage of new external opportunities in residential development and Australian investment grade real estate.

Mirvac said the placement was significantly oversubscribed with demand from both existing and new Australian and international institutional investors. As a result, the group said it was forced to scale back bids.

Mirvac said the funds were raised through the placement of 250 million Mirvac stapled securities at a fixed price of $1.40 per stapled security.

The group said the proceeds would reduce pro forma balance sheet gearing from 23.2% to 20.7%, increase liquidity to $1.4 billion and increase cash on hand to $400.3 million.

Mirvac also intends to offer eligible securityholders the opportunity to purchase stapled securities through a Security Purchase Plan (“SPP”) to raise up to $150 million at a price of $1.40 per stapled security.

The group said settlement is scheduled to take place on 13 April 2010, with new stapled securities expected to be issued and commence trading on ASX on 14 April 2010.

At the close of trade yesterday, Mirvac shares were trading at $1.48.

Westpac said that it has entered into exclusive discussions with Mirvac Group (MGR) for the property group to acquire Westpac Office Trust. The discussions, which involve the purchase of all units and instalment receipts, would allow Mirvac to conduct due diligence on Westpac Office Trust. Westpac stressed however that there was nothing binding or certain in relation to these discussions.

Meanwhile Mirvac has announced a fully underwritten Institutional Placement to raise $350 million, coupled with a non-underwritten $150 million security purchase plan for existing shareholders.

Mirvac suggested the funds raised would be used for any potential purchase of Westpac Office Trust, while also allowing the ‘fast tracking’ of its commercial and residential development pipelines.

Managing Director, Nick Collishaw said the group was at an opportune time in Australia’s economic and real estate cycle to acquire and develop investment and residential assets.

“Raising capital allows the Group to expedite the development of its existing commercial and residential project pipelines whilst enhancing the Group’s balance sheet strength and improving our credit metrics,” Mr Collishaw said.

The group said the Institutional Placement would offer new stapled security at $1.40 each, or a 5.5% discount to yesterday’s closing price of $1.48.

At the same time, Mirvac reaffirmed its previously offered guidance of 9.2c per security.

GPT Group (GPT) said GPT Wholesale Office Fund has acquired a 50% stake in the office development, 163 Castlereagh Street, Sydney from Grocon Developments. The group said it had pre-purchased the building at a cost of $333 million, funding the construction on a cost to complete basis, with Grocon taking the development risk and providing rent guarantees for the Fund.

GPT forecast the deal to deliver an unlevered IRR of approximately 11% with a capitalisation rate of 6.75%.

Fund manager, Martin Ritchie, said GWOF’s investment is consistent with the fund’s strategy to own top quality Australian office assets and would increase its premium grade weighting from 57% to 62% upon completion.

“Scheduled for completion in mid 2013, leasing of this premium grade office asset is extremely strong with 76% of space having been pre-committed to ANZ and Freehills on 15 and 10 year leases respectively, providing a weighted average lease duration of 12.5 years,” Mr Ritchie said.

GPT said the 42 level tower would comprise 57,800 square metres in total with 54,450sqm of office space and 3,350sqm of retail space plus 100 car spaces once completed.

The group said Grocon and LaSalle Investment Management would each have a 25% interest in the asset.

As at 1131 AEDT, GPT shares were up 0.5c to 59c.

Mirvac Group (MGR) said the group was seeing a number of positive signs in the marketplace, and despite expressing caution, also said it was confident of its direction. Writing in the company’s half-year report this morning, managing director, Nick Collishaw, said that capital management initiatives in the last 18 months meant the group was in a strong position to capitalise on opportunities when they arise.

The property group reported, for the six months to 31 December 2009, a net profit after tax of $47.2 million and an operating profit of $129.4 million.

As has been reported previously Mirvac said that the result of the successful acquisition of the separately listed Mirvac Real Estate Investment Trust in December 2009, had prompted the company to revise its earnings guidance for the 2010 financial year, with earnings per security at 9.2c and the distribution per security remaining at 8.0c – 9.0c.

The company however also struck a cautious tone.

“Nevertheless, the impact on affordability from rising mortgage rates and higher prices, and the removal of the first home buyer boost scheme is expected to moderate the rate of further price growth,” Mirvac noted.

Mirvac shares closed Tuesday at $1.48.