GlobeSt.com UPDATE: DDR, Macquarie Bank Forming Listed Property Trust

SYDNEY-Developers Diversified Realty of Cleveland and locally based Macquarie Bank Ltd. are forming an Australia-based property trust that will focus on acquiring ownership interests in institutional-quality community center properties in the US. GlobeSt.com reported in September that Developer’s Diversified was in the process of forming the investment entity.

Macquarie DDR Trust, expected to list on the Australian Stock Exchange by year’s end, will launch with an 81% interest in a $730-million portfolio of 11 community centers (4.8 million sf GLA) currently owned either directly by Developers Diversified or through Developers Diversified-sponsored joint ventures. Developers Diversified will retain a 14.5% effective ownership interest in the assets and MBL will own the remaining 4.5%.

Developer’s Diversified will receive approximately $185 million in cash with regard to the transaction and Macquarie DDR Trust will carry approximately $374 million in debt. The interest rate for this debt will generally be structured with 80% fixed at 4.4% and 20% floating at estimated initial weighted average interest rate of 3.85%.