QIC today announced plans to expand its Global Real Estate operation in the United States by acquiring additional interests of its joint venture partner, Forest City Enterprises (FCE), in 10 U.S. regional shopping malls on behalf of a QIC client. The portfolio is valued at approximately USD $3.175 bn.
Alongside the acquisition of interests in the regional malls, the master agreement signed today also expands QIC’s operational presence in the U.S. and includes transferring the FCE retail operating platform in relation to the malls and key retail personnel to QIC.
“QIC and Forest City have been in a very successful joint venture since 2013, and we are pleased to have reached this milestone,” said Steve Leigh, Managing Director of Global Real Estate for QIC.
“We are building off more than a decade of amassing market intelligence and understanding in the U.S. retail sector. We view the U.S. real estate market and the retail sector in particular as a strong investment opportunity. We are encouraged by the broader economic conditions in the U.S. and the resilience of the consumer as demonstrated by continuing strength in the underlying fundamentals for the portfolio. We understand the importance of regional malls to their local communities and have the capability and the capital to evolve these assets into multi-faceted destinations,” he said.
The transaction will be completed in two tranches with the transfer of interests in the first six malls expected to complete by the end of the year, subject to third party consents. The assets in the first tranche include The Shops at Northfield Stapleton in Denver, CO; Westchester’s Ridge Hill in Yonkers, NY; The Shops at Wiregrass in Tampa, FL; The Mall at Robinson in Pittsburgh, PA; Antelope Valley Mall in Palmdale, CA; and South Bay Galleria in Redondo Beach, CA. QIC has the benefit of an option over the following four malls in the second tranche, which are expected to transact as the parties satisfy certain conditions: Victoria Gardens in Rancho Cucamonga, CA; Galleria at Sunset in Henderson, NV; Promenade Temecula in Temecula, CA; and Short Pump Town Center in Richmond, VA.
“We have an incredibly strong Australian business, which has demonstrated through its 25-year-plus track record that we know how to acquire and invest in real estate assets that remain an integral part of their community,” said Damien Frawley, CEO of QIC.
“We look forward to applying this approach in a large and attractive market with real estate fundamentals that are similar to those in Australia. We are delighted to maintain continuity of knowledge by welcoming Forest City’s operational staff to our global real estate operating platform. I have already personally welcomed to our team those people working in the leasing, marketing, tenant coordination, legal and human resources functions and look forward to doing the same with those in accounting and property management, building out the QIC employee base in the U.S. significantly,” he said.
“We see the QIC GRE U.S. platform expanding to become as large and successful as the Australian platform across time. We are extremely pleased to have been able to work closely with our partner FCE to conclude this transaction and provide our clients with a targeted and sound investment opportunity,” Mr Leigh said.
QIC is a global diversified alternative investment firm offering infrastructure, real estate, private equity, liquid strategies and multi-asset investments. It is one of the largest institutional investment managers in Australia, with A$82.0 billion (US$62.9/£48.4 billion) in funds under management, offering infrastructure, real estate, private equity, liquid strategies and multi-asset investment services. QIC has over 700 employees and serves more than 110 clients including governments, pension plans, sovereign wealth funds and insurers, spanning Australia, Europe, Asia, Middle East and the US. Headquartered in Brisbane, Australia, QIC also has offices in New York, San Francisco, Los Angeles, London, Sydney, and Melbourne. For more information, please visit: www.qic.com.
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QIC Limited ACN 130 539 123 (“QIC”) is a wholesale funds manager and its products and services are not directly available to retail clients. QIC is a company government owned corporation constituted under the Queensland Investment Corporation Act 1991 (Qld). QIC is regulated by Australian State Government legislation pertaining to government owned corporations in addition to the Corporations Act 2001 (Cth) (“Corporations Act”). QIC does not hold an Australian financial services (“AFS”) licence and certain provisions (including the financial product disclosure provisions) of the Corporations Act do not apply to QIC. QIC Private Capital Pty Ltd (“QPC”), a wholly owned subsidiary of QIC, has been issued with an AFS licence and other wholly owned subsidiaries of QIC are authorised representatives of QPC. QIC’s subsidiaries are required to comply with the Corporations Act. QIC also has wholly owned subsidiaries authorised, registered or licensed by the United Kingdom Financial Conduct Authority (“FCA”), the United States
 As at 30 June 2017