The Australian - July 13, 2010
The Brisbane-based REIT has agreed to pay $143m for the 50,000 sq m building and an extra $26m to fund an office fit-out in a trade-off for a 10-year Qantas office leaseback.
The purchase, less than a week after the $600m Cromwell Group dropped out of the bidding for Melbourne's troubled Orchard Funds Management business, involves both the freehold and leasehold of the Mascot complex.
Qantas owns the freehold of the 203 Coward Street property while the leasehold -- bought by an Allco syndicate for around $150m a decade ago -- is controlled by the Trafalgar-managed Sydney Airport Centre Joint Venture.
Cromwell, which yesterday announced a placement and rights issue to raise up to $120m, will use $85m from the capital raising and an $84m debt facility to fund the Qantas acquisition. Its equity raising involves an institutional placement to raise between $52m and $80m at 75c, with the balance coming from a 72c rights issue.
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