The Westfield Group announced today that it has reached agreement with its co-holders in Duelguide plc (Multiplex Group and companies affiliated with the Reuben Brothers) whereby Westfield will purchase an additional 25% interest in White City for £65 million. This will increase Westfield's ownership of the White City development to 50% on project completion. Westfield acquired its initial 25% interest as part of the Duelguide/Chelsfield acquisition in December, 2004.
After purchasing this additional 25% interest and including additional costs to the project due to design enhancement initiatives, Westfield's investment in White City is expected to be £850 million to £870 million including the cost of acquiring Westfield's 50% interest for £130 million. The initial yield is expected to be in the range of 5.75% to 6.0%. Westfield will fund its share of the development cost (£720 million - £740 million) only on completion of the project, expected to be in the first half of 2008.
In a separate transaction, Westfield has been appointed development manager and leasing agent for the White City project and on completion, the long-term shopping centre and asset manager. This appointment was agreed with Commerz Grundbesitz Investment GmbH (CGI), (on behalf of Hausinvest Europa, Germany's largest open-ended property fund), the owner of the remaining 50% interest in the project and responsible for funding the development costs.
The White City project is a super regional shopping centre development located in inner West London. Upon completion in the first half of 2008, the centre will have approximately 150,000 square metres of retail and leisure space, making it the largest shopping centre in greater London. Multiplex is the builder for the White City project.