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HomeCo prepares new float with $220m shopping centre deals

It is looking to list in November amid suggestions of a market value of about $500 million and is aimed at retail investors, similar to the Homeco float.

The parent HomeCo, whose hyper-convenience retail model grew out of Woolworths’ failed Masters hardware sites, was listed late last year. It has grown its funds under management to $1.2 billion and has seen an increase in asset value of about 5 per cent despite the global pandemic.

Former UBS banker Matthew Grounds, the Oatley family and Aussie Home Loans founder John Symond also backed the HomeCo float last year.

In the float presentation, HomeCo Daily Needs REIT has a forecast 5 per cent distribution yield, and a conservative capital structure with target gearing range of 30-40 per cent.

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Brokers to the float will be Goldman Sachs and Macquarie Capital and the board will include property stalwarts Simon Tuxen, formerly at Westfield, and Simon Shakesheff from Stockland as independent non-executive directors.

The trust will have a deliberate focus on hyper-convenience and daily needs tenants and a strong diversification across tenants, sectors and geographies.

HomeCo chief executive Mr Di Pilla said the proposed HomeCo Daily Needs REIT was consistent with HomeCo’s stated “own, develop and manage strategy”.

“This has helped to establish the platform for HomeCo to unlock additional value and growth through further capital recycling and ongoing management fee streams from assets under management,” Mr Di Pilla said.

“The property acquisitions announced will provide the HomeCo Daily Needs REIT with additional exposure to key growth corridors within the western Sydney metropolitan area and will be important seed assets for the Daily Needs REIT.”

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