UniSuper, Cbus win right to buy $830m Macquarie Centre stake off Dexus
The NSW Supreme Court found that AMP’s decision to sell its stake in Macquarie Centre to Dexus was a breach of contract. Photo: Dion Georgopoulos

UniSuper, Cbus win right to buy $830m Macquarie Centre stake off Dexus

Dexus, one of the country’s largest real estate landlords, will have to sell an $830 million stake in Sydney’s massive Macquarie Centre to UniSuper and Cbus Property after the superannuation giants successfully argued in court that they had the right to take over the entire shopping mall.

Macquarie Centre is one of the city’s biggest retail precincts and is worth $1.7 billion. It is half owned by UniSuper and Cbus Property, the real estate arm of the eponymous industry superannuation fund, with the remaining stake owned by a wholesale fund operated by Dexus.

The NSW Supreme Court found that the transfer of control over the $1.7 billion Macquarie Centre to Dexus was a breach of contract.
The NSW Supreme Court found that the transfer of control over the $1.7 billion Macquarie Centre to Dexus was a breach of contract. Photo: Dion Georgopoulos

In an unusual move, UniSuper and Cbus Property asked the Supreme Court in NSW to force Dexus to sell them its share of the property – and its well-known ice rink – after arguing that the ASX-listed owner of shopping centres, industrial parks and offices had inadvertently breached a contract.

Macquarie Centre was opened in 1981 and has long been owned by various AMP-related funds. AMP offloaded its real estate asset management business after the Hayne royal commission and a number of scandals involving executive conduct, wholesale board and executive turnover, failed takeover talks and an exodus of funds under management.

The stoush over the mall started two years ago amid the break-up of AMP’s crumbling $28 billion funds empire. Dexus swooped on the opportunity to take over running AMP’s stable of property and local infrastructure funds, a major boost to its ambitions to become a leading investment manager.

But the two superannuation funds claimed Dexus’ move on the AMP platform triggered a pre-emptive right for them to acquire the rest of Macquarie Centre. In a legally complex dispute, the two funds – whose 50 per cent ownership is called the Macquarie Retail Trust – claim they gained pre-emptive rights because the transfer breached contractual rules.

Dexus disputed these claims, alleging Macquarie Retail Trust did not seek information about the ramifications of Dexus’ deal to acquire AMP’s real estate platform until four days after it was finalised.

Dexus was aware of the potential for pre-emptive rights as it worked through the deal but was confident they were not triggered by the way the transaction was structured, people close to the discussions but not authorised to speak publicly about them said.

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Two months after Dexus finalised its deal early last year, Macquarie Retail Trust – the ownership vehicle of the two funds – sent an unconditional contract for the purchase of its half stake of the mall for $830 million.

In response, Dexus’ lawyers accused the superannuation funds of failing to act in good faith, and rejected the proposed deal. Cbus and UniSuper launched legal proceedings in the Supreme Court in November.

The court on Friday found that UniSuper and Cbus did have the right to buy the rest of Macquarie Centre from the Dexus-run fund. The two super funds intend to press ahead and buy the centre, a spokesman said.

A spokesman for the Dexus Wholesale Shopping Centre Fund – which holds the 50 per cent of the mall – said the company was reviewing its options.

“Dexus remains focused on working with the responsible entity board to deliver the best outcome for investors,” he added.