Reading International, Inc. (NASDAQ:RDI) announced today that we have
entered into a contract to sell our undeveloped 50.6 acre parcel in
Burwood, Victoria, Australia.
The sale is to an affiliate of Australand Holdings Limited for a
purchase price of AUS$65.0 million (US$59.1 million). The contract is
not subject to any due diligence or board approval conditions, and it is
currently anticipated that the sale will close on or before May 23,
2014. The buyer’s performance is guaranteed by Australand Holdings
Limited.
Reading will receive AUS$6.5 million (US$5.9 million) on the closing.
The balance of the purchase price is due on December 31, 2017. The
agreement provides for mandatory pre-payments in the event that any of
the land is sold by the buyer, any such prepayment being in an amount
equal to the greater of (a) 90% of the net sale price or (b) the balance
of the purchase price multiplied by a fraction the numerator of which is
the square footage of property being sold by the buyer and the
denominator of which is the original square footage of the property
being sold to the buyer. The agreement does not provide for the payment
of interest on the balance owed.
Our book basis in the property is AUS$52.1 million. However, this figure
includes (i) a capitalized allocation of AUS$11.3 million of our
aggregate interest expense during the period we held the property and
(ii) an AUS$12.0 million upward mark to market revaluation in connection
with a 2001 merger transaction. Netting out this interest allocation and
this merger mark-to-market revaluation, our investment in the property
totals AUS$28.8 million.
This is our second major land disposition transaction in the past twelve
months. As we previously announced, on October 21, 2013, we entered into
a contract to sell our 3.3 acre Moonee Ponds property. That contract
provides for an April 16, 2015 close, having gone unconditional
following the agreement by the Foreign Investment Review Board, to the
sale. The contract further calls for the full purchase price of AUS$23.0
million (US$20.9 million) to be released to Reading on that day.
On completion these two transactions will generate a total of
approximately AUS$88.0 million (US$80.0 million) in cash to our company
by the end of 2017. Neither of these properties is currently income
producing to any material extent.
About Reading International, Inc.
Reading International (http://www.readingrdi.com)
is in the business of owning and operating cinemas and developing,
owning and operating real estate assets. Our business consists primarily
of:
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the development, ownership and operation of multiplex cinemas in the
United States, Australia and New Zealand; and
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the development, ownership, and operation of retail and commercial
real estate in Australia, New Zealand, and the United States,
including entertainment-themed retail centers (“ETRC”) in Australia
and New Zealand and live theater assets in Manhattan and Chicago in
the United States.
Reading manages its worldwide business under various different brands:
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in the United States, under the
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in Australia, under the
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in New Zealand, under the
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