The story
Direct Factory Outlet was founded in 1997 by Liberty Oil founders David Goldberger and David Wieland. The first centre was opened at Moorabbin Airport in 1994. Other shareholders were property developer Geoff Porz and former Australian Competition & Consumer Commission chief Graeme Samuel through a blind trust. Valued at A$1.5 billion, in early 2010 the business was put up for sale with a number of retail investment funds expressing interest.
DFO centres have traditionally been located around airports: a side effect of the Airports Act of 1996, the federal government has planning control over the land, meaning state planning legislation can be bypassed by developers. In addition the property developer is able to exploit the cost difference between retail and industrial rents, which gives outlet centre operators a distinct advantage over traditional shopping centres. A survey by The Age in 2007 found that in all three DFO-owned centres, most shops carried at least some full-price, current-season stock, available at normal shopping centres. By 2008 five legal challenges to DFO developments have been made by competing retail developers and the Shopping Centre Council of Australia, all being unsuccessful.
On 16 August 2010, lead bank Suncorp-Metway, along with St George Bank, National Australia Bank and Lloyds Banking Group, issued a notice to parent company Austexx demanding repayment within 24 hours of the A$450 million they are owed. The South Wharf centre was under an A$500 million debt, with work on completing the centre stopped after workers placed bans over non-payment. Parent company Austexx was understood to have had total debts of A$1.2 billion, with the four relatively successful DFO sites used as cross-collateral for bank-funded expansion into five other less successful locations including Canberra, Cairns and Hobart. The group of banks appointed insolvency specialists KordaMentha as advisers, with the entire group facing receivership. Negotiations continued until a deal was struck on 19 August, the four banks extending their funding to allow the South Wharf development to be completed. The ten DFO shopping complexes were then sold off separately to repay the $1 billion owed to the banks. In September 2010, CFS Retail acquired the Essendon, Homesbush and Moorabbin centres and a 50% shareholding in South Bank. All four passed to Vicinity Centres when it merged with CFS Retail. Vicinity would acquire the Brisbane centre in May 2016.
From Wikipedia’s article on Direct Factory Outlet, shared under CC BY-SA 4.0.4