Cornerstone stakes in two super-regional Australian shopping centres have gone up for sale in the first such investor opportunity in two years.
Dexus Wholesale Property Fund is offering a 20-per-cent interest in Gold Coast’s Pacific Fair Shopping Centre and a 25-per-cent stake in Sydney’s Macquarie Centre.
The stakes were held by the AMP Capital Diversified Property Fund before its recent merger with Dexus Wholesale Property Fund. CBRE’s Simon Rooney and JLL’s Nick Willis and Sam Hatcher will lead an expression of interest campaign for the assets.
At around 150,000sqm Pacific Fair Shopping Centre (pictured above) is the fifth largest shopping centre in Australia by gross lettable area (GLA) and ranks in the top 10 performers in Australia with more than $890 million in moving annual turnover.
The slightly smaller 135,000sqm Macquarie Centre, situated 19km from Sydney’s CBD, is located adjacent to the Macquarie Metro Station and Macquarie University, in the heart of the Macquarie Park business park – Australia’s largest non-CBD office market.
The mall has a current concept approval for a further 148,000 sqm of mixed-use gross floor area, including commercial, living, and alternatives.
Rooney, head of retail capital markets at CBRE, said Australian retail owner-managers, institutional funds and offshore investors are expected to be among bidders for the assets.
“The positive turnaround in institutional investor sentiment and capital reallocation back to retail is in its early stages, but clearly evident and is centred on assets which are considered the ‘best of the best’ – criteria clearly met by Pacific Fair and Macquarie Centre,” he said.
The most recent transactions in the super-regional mall category were the sale of a 50-per-cent stake in Westfield Marion in South Australia for $670 million to Singapore Press Holdings and a 50 per cent in Garden City Booragoon in Western Australia for $575 million to Scentre Group, both in late 2019, ahead of the Covid-19 outbreak.
“We have seen a material rebasing in retail asset values over the past 12 to 18 months, together with a ‘mark to market’ rental reset,” said Rooney. “This, combined with monthly sales and traffic growth and the historically attractive retail yields on offer… presents a real window of opportunity for major domestic and offshore investors.”
Willis added that Pacific Fair and Macquarie Centre are two of Australia’s leading retail destinations.
“They are more than just shopping centres – their scale and integration in the market make them core pieces of infrastructure that shape their respective markets.”
He said that with retail performing well coming out of lockdowns, the best quality assets will continue to outperform.