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The David Jones store on Elizabeth Street, Sydney houses a number of high-end designer brands. Photo: Getty
- Woolworths sold its flagship David Jones in Sydney for R5.6 billion.
- The group spent years and billions of rand renovating the property, and the project was only completed earlier this year.
- But Woolworths is struggling with more than R11 billion in debt and needed the cash.
- For more stories, visit www.BusinessInsider.co.za.
After spending years and billions of rand renovating its David Jones flagship store in Australia, Woolworths has decided to cut its losses.
It is selling the store to help control its R17 billion debt burden, created by its disastrous foray into Australian retail.
Woolworths bought the David Jones chain in 2014 for more than R21 billion at the time. Since then, he has been forced to write off at least half of that amount, as the Australian group continued to disappoint.
The company recently completed a billion-rand project to renovate the huge Elizabeth Street store in Sydney, which now also includes concession stores, much like those of the UK’s luxury department stores, Selfridges and Harrods.
But on Tuesday, it announced that it was selling the property for 510 million Australian dollars (5.6 billion rand) to Australia-based property manager and developer Charter Hall, who will lease the space to Woolworths as part of a contract. 20-year rental.
The transaction, which follows another recent sale of a property in Australia, was well received by investors, and Woolworths’ share price rose more than 4% on the day.
Inside the legendary Elizabeth Street store
The 182-year-old David Jones group opened their Elizabeth Street store in 1927. It is the oldest department store in the country. The store was listed during World War II, and in 1954 it was the site of a state banquet held in honor of the visit of Queen Elizabeth II. It also hosted the first Christian Dior fashion show to be held outside of Paris.
Following the renovation, each floor now houses a dedicated shopping category, including a basement level for household items.
The basement houses luxury products for the home.
a food section
David Jones Food, kitchen utensils and small appliances downstairs.
four floors dedicated to women’s and men’s fashion, as well as a level dedicated to designer footwear
Level 7, the department of designer shoes
and a Disney-themed children’s floor.
Walt Disney themed level in the children’s department on Level 9 of the building.
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