Australian-based AMP Capital Property sold West Auckland's LynnMall shopping center US$174 million Kiwi Income Property Trust.

The deal will be formalized on December 31 pending Overseas Investment Office approval. Kiwi Income Property Trust is using debt to pay for the mall.

LynnMall shopping center, New Zealand's first mall, was build in 1963 and currently has 110 tenants with 99.6 percent of its 30,661 square meter retail space occupied. Its road and public transport links has been recently improved which now has a rail and bus transport center nearby. The mall also caters to the specialty market with 11 foodcourt units, 103 shops and nine kiosks.

"LynnMall provides us with an opportunity to apply our proven active asset management model to improve the centre's attractiveness and competitiveness to shoppers and tenants alike.," Kiwi Income Property Trust chief executive Chris Gudgeon said in a statement. "In acquiring this asset, we have already identified potential opportunities to enhance the center and its retail mix by drawing on our extensive network of national and international retailers,"

The purchase is in line with Kiwi Income Property Trust aim to increase investments in Auckland's retail market. It already holds other retail assets such as Sylvia Park, Center Place in Hamilton and The Plaza in Palmerston North. The trust is using bank debt to pay for the mall, increasing its net bank debt gearing ratio to 31 percent from six percent.