Charter Hall Retail REIT (REIT) has bought eight neighbourhood and sub-regional shopping centres for AUD266 million (USD281.8m) from Woolworths, in joint venture with Telstra Super, one of Australia's largest superannuation funds.

The acquisition is consistent with the REIT's strategy of reweighting to Australia, enhancing income security and growth through investing in quality grocery anchored neighbourhood and sub-regional shopping centres.

The portfolio comprises six neighbourhood and two sub-regional shopping centres, all developed by Woolworths between 1999 and 2009 and all anchored by a full line Woolworths supermarket. In total, Woolworths' businesses (including supermarkets, Big W discount department stores, Dick Smith Electronics, Woolworths Liquor and Dan Murphy liquor outlets) account for more than 51 percent of the portfolio's annual base rent. Net operating income for the 2012 financial year is forecast to be approximately AUD21.33m, using externally verified sales forecasts for the anchor tenants.

Charter Hall will provide all property, leasing, financial and development management services to the portfolio. The transaction is expected to be completed in June 2011.

"This transaction has enabled Charter Hall Retail REIT to almost immediately redeploy equity from the sale of its non-core assets. In addition to being accretive in year one the acquisition enhances the REIT's long term income and capital growth prospects and we are pleased to have the opportunity to partner with Telstra Super on this portfolio," said Steven Sewell, Charter Hall Retail REIT CEO.