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Vicinity Shopping Malls Worth $1.8B Less Because Of COVID

Vicinity Centres has announced that independent valuations of its 60 directly owned retail properties have resulted in a net valuation decline of 11.3% for its portfolio, translation to $1.79 billion being wiped from its value.

These independent valuers took into account the significantly increasing vacancies, downtime, leasing capital, and the lowers expectations for sales and market rental growth over the short to medium term.

This decline in value is within the 11-13% range that was announced on 1st June in conjunctions with Vicinity’s equity raising.

“We have independently valued our entire portfolio at 30 June 2020. While the overall portfolio net valuation decline was 11.3%, the results highlighted the resilience of our Flagship portfolio, affirming our strategy and weighting towards metropolitan markets with strong long-term fundamentals,” said Grant Kelley, CEO and Managing Director of Vicinity Centres.

Vicinity’s share price has fallen by over 37% since the start of March, closing at $1.41 yesterday.

In early July Vicinity successfully completed its non-underwritten Security Purchase Plan, raising approximately $32.6 million. This followed Vicinity’s $1.2 billion underwritten institutional placement completed in early June.

At the time, Vicinity stated that the proceeds of the Security Purchase Plan would be used to pay down debt.

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