David Jones' parent company Woolworths Holdings (South Africa) has completed the sale of the Elizabeth St store to Charter Hall.
As previously reported by Charter Hall, the purchase price for the 3,530sqm, 12-floor property was $510 million, the proceeds of which will be used by Woolworths to repay debt in Australia.
According to Woolworths, the property sale and refinancing have facilitated the separation of the combined Australian debt and financing facilities of the David Jones and Country Road Group - meaning that they are now financed separately.
The deal sees David Jones enter into a 20 year, triple net (NNN) leaseback with Charter Hall, continuing the retailer's presence on Elizabeth St.
The agreement sets out a minimum 2.5% per annum annual rent increase, supplemented by an agreed turnover rent linked to sales performance.
Speaking on the deal, Charter Hall CEO and MD, David Harrison said that the acquisition aligns with Charter Hall's broader strategy.
"This acquisition is consistent with our strategy in so many ways.
"Namely; securing long weighted average lease expiry (WALE) NNN leased assets; combining the appetite of our managed funds and partnerships to partner with the Group on high conviction prime real estate acquisitions; co investing Group capital alongside our partners to secure attractive earnings growth from our Property Investment portfolio; and, also expanding the Group’s funds under management (FUM) platform," he said of the deal in December.
The completion of the acquisition was finalised on March 12.