Bob Ell buys Tuggeranong Hyperdome

The low-profile, billionaire developer has beat local and offshore interests to take control of the Tuggeranong Hyperdome.

Billionaire Bob Ell has taken full control of the $240 million Tuggeranong Hyperdome in the ACT by buying out co-owner Vicinity Centres.

The property developer, whose Leda Holdings operation has a four-decade history, was this year ranked as the second richest person in Queensland with a $1.33 billion fortune.

Mr Ell keeps a low profile but has ridden the residential boom by rolling out estates across NSW and Queensland, as well as reaping the benefits of the rising values on his retail, office and industrial holdings.

Vicinity is surging through its sales program and selling its $120m stake in the centre takes its sale tally to about $1.4 billion. It is offloading assets across Australia as it looks to cut debt and fund its ambitious development pipeline.

The Tuggeranong Hyperdome also won interest from local and offshore investors in a process run by McVay Real Estate but Mr Ell was always seen as the logical buyer.

Vicinity, led by Angus McNaughton, in May boosted the scale of its non-core asset sales program to $1.5 billion, and has capitalised on the rising prices of shopping centres.

The group in June flagged a further $350m of asset sales this year, with details of much of the sale portfolio revealed by The Australian, including the off-market offer of the stake in the Tuggeranong Hyperdome.

Vicinity in May surprised the market by agreeing to sell stakes worth $224.6m in two shopping centres to industry super fund-backed ISPT. ISPT acquired a 25 per cent stake in The Myer Centre, Brisbane, and a half-interest in Mornington Central in Victoria.

The Tuggeranong Hyperdome, a two-level regional shopping centre to the south of Canberra, was acquired by the company during the property boom.

The entrepreneurial Andrew Scott was then running Vicinity forerunner Centro Properties Group and sought to strike a wider deal with Mr Ell.

Centro in 2005 unveiled a joint venture with his Leda Holdings, in which the listed group invested $195.6m to acquire a half-interest in Tuggeranong.

Leda, in turn, took a half-interest in a Centro centre in Hervey Bay and poured $50m into the Centro Direct Property Fund International.

While a broader deal never came off as Centro faced near-collapse during the global financial crisis, the centre performs well and is anchored by Target, Kmart, Coles, Woolworths, Big W, Harris Scarfe and Limelight Cinema, and has more than 120 specialty stores.

It opened in 1987 and was last redeveloped four years ago, giving it a gross leasable area of 76,120sq m. It had a moving annual turnover of $294.3m and 2366 car spaces.

The value of Vicinity’s stake was trimmed back to $140m at the end of December as the capitalisation rate it was held on edged up to 7.75 per cent. It was further trimmed back to $120m at the end of June.

Vicinity has also sold the bulk a parcel of centres, including Tweed Mall, Wodonga Plaza, Maitland Hunter Mall, Hilton Plaza, Monier Village and Albany Brooks Garden, that it put on the block in June.