Coles and property fund manager ISPT have entered into a joint venture for ISPT to acquire a 75 per cent interest in an initial portfolio of 19 Coles-owned shopping centres.
Coles will continue to manage the centres and will retain a 25 per cent interest in the centres.
“This joint venture with ISPT means Coles has secured a long-term property partner with closely aligned commercial interests,” Rob Scott, finance director at Coles, said.
“By retaining property development and management rights, Coles can ensure that it has flexibility and control over both store format layouts and the in-store experience for our customers.
“The arrangement also affords Coles the opportunity to secure funding for our future store growth plans.”
ISPT is an unlisted property management fund with more than $8 billion of funds under management.
Coles and ISPT plan to examine further properties for the joint venture as opportunities arise, with Coles to retain development control over any further joint venture properties.
The initial portfolio is valued at around $532 million and will provide around $400 million in capital proceeds to Wesfarmers.
“This joint venture with ISPT progresses Wesfarmers’ plans to recycle capital in business divisions that have experienced strong growth in freehold property,” Terry Bowen, finance director at Wesfarmers, said.
“Wesfarmers will continue to look for innovative structures and partnerships such as this to create value for our shareholders.”
In other retail news, the Reject Shop has announced it is scheduled to open 40 new stores in the 2013 financial year, doubling its annual average of new store openings.
The company has already opened 35 stores in the year to date, including 18 new stores during the second half. Another five new stores are scheduled to open before the end of the financial year.
The Reject Shop will have more than 270 stores by June 2013. The company also plans to open another 40 new stores in the 2014 financial year, with most of those to open in the first half of the next financial year.
This will take the total number of Reject Shop stores to more than 300 by 30 June, 2014.
The new stores are expected to help leverage off the company’s existing infrastructure, provide long-term profitability and provide a more “balanced” national portfolio.
“We have an opportunity to accelerate our long term growth plans and significantly increase our overall store footprint,” Chris Bryce, managing director at the Reject Shop, said.
“Over the past few years we have built our infrastructure, both in terms of physical capacity and organisational strength, in order to support our long-term aim of building a portfolio of 400 stores nationwide.
“We have the capacity within the business to support the rapid growth currently underway and planned for FY2014. While managing this level of growth in the short-term is challenging, the future benefits to our business and shareholders should be significant.”
Bryce said planning for the 201 4 financial year stores is advanced and includes increasing the purchase of store fittings and stock.
Beyond the 2014 financial year, Bryce said he expects the Reject Shop’s store opening program to return to more historic levels.
Sony has also announced it will open a new kiosk at Westfield Parramatta. The kiosk store model has been designed to provide an interactive experience for shoppers with Sony products across several categories, including PCs, digital imaging and smartphones.
Specialists will also educate shoppers about retail technological innovations, such as wireless Near Field Communications technology.
“Sony Kiosks are a key part of our retail strategy,” Jeremy Senior, general manager of sales, Sony Australia, said.
“By providing an accessible and engaging environment in a high-traffic location, we expect shoppers to become more educated about Sony’s unique technology and lifestyle solutions.”