Singapore’s Paragon REIT Selling Its 85% Stake in Aussie Mall for $106M

Paragon REIT has announced plans to sell its entire 85 percent interest in a New South Wales mall for A$163.2 million ($106.4 million), a divestment which pares the Singapore-listed trust’s Australia portfolio down to a single asset.

The deal values Figtree Grove Shopping Centre in Wollongong at A$192 million and represents a 5 percent premium to an independent valuation of A$183 million, the trust’s manager said Friday in a release. Local media identified the buyer as Melbourne-based fund manager Fawkner Property Group, which is also buying out co-owner MA Financial’s stake in the 236,629 square foot (21,984 square metre) mall.

The deal represents the latest disposal of an asset formerly linked to Singapore Press Holdings since the company’s real estate portfolio and the manager of SPH REIT (later rebranded as Paragon REIT) were acquired by Cuscaden Peak, a consortium formed by tycoon Ong Beng Seng and his Hotel Properties group alongside Temasek units CapitaLand and Mapletree.

“The divestment consideration enables Paragon REIT to divest at a premium while maintaining a strong foothold in its key markets,” the manager said.

Shrinking Portfolio

The trust bought its 85 percent stake in Figtree Grove in 2018 for A$175.1 million. Located on Princes Highway in the Wollongong suburb of Figtree, the 97.9 percent occupied mall is anchored by Coles and Woolworths supermarkets and a 24-hour Kmart department store.

With the deal valuing the property at A$811 ($529) per square foot of gross lettable area, Paragon REIT expects to complete the disposal in the first quarter of 2025 with net proceeds of S$142 million ($105.4 million).

Paragon REIT’s sole remaining asset Down Under is a 50 percent interest in Adelaide’s Westfield Marion Shopping Centre, a joint venture with Scentre Group, Australia’s biggest retail landlord. The SGX-listed trust picked up the half-stake in 2019 for A$670 million.

More recently, Paragon REIT in August completed the S$78.5 million sale of The Rail Mall in Upper Bukit Timah, leaving the S$4.1 billion trust with two Singapore assets — the Paragon and Clementi malls. The pair of shopping centres will contribute 83 percent of the trust’s net property income and 87 percent of assets under management going forward, according to the manager.

Liquidation Update

The Rail Mall and Figtree divestments are the third and fourth disposals announced by a Cuscaden Peak entity this year.

In April, Cuscaden agreed to sell a portfolio of 31 European student housing properties to Mapletree, with those assets having been part of the Singapore Press Holdings portfolio. The deal came one month after a joint venture of Cuscaden and Yanlord Land’s United Engineers Ltd unit completed its S$550 million sale of the Seletar Mall in northeastern Singapore to Robert Kuok’s Allgreen Properties.

Mingtiandi reported in July that Cuscaden was marketing its Woodleigh Mall in north-central Singapore for S$800 million. The project next to Woodleigh MRT station was completed last year and is held in a 50:50 joint venture of Cuscaden and Japan’s Kajima Corp, with the asking price valuing the mall at S$3,874 per square foot for its net lettable area of 206,530 square feet.

Note: This article has been updated to clarify that the deal values Figtree Grove at A$192 million and Paragon REIT’s stake at A$163.2 million.