This article is from the Australian Property Journal archive
US giant Blackstone has again listed for sale Adelaide’s headline retail asset, Rundle Place, in one of the most anticipated offerings this year, having initially put it to the market nearly two years ago as part of a nationwide portfolio potentially worth $4 billion.
It had acquired Rundle Place with the adjacent 80 Grenfell Street office tower – the headquarters of Bendigo Bank – in a package deal for $400 million just over three years ago, and last year sold the Grenfell Street building to Centuria Capital and the Lederer Group for $184.6 million.
The Rundle Place package had been part of Blackstone’s 10-asset portfolio that it offered to the market in 2017, before it pulled the plug on the mega-offer that could have set a new Australian commercial property transaction record.
Rundle Place, at 77 Rundle Mall within Adelaide’s major retail precinct, is being marketed by Knight Frank’s Guy Bennett and Neil Brookes in conjunction with Sam McVay and Dan McVay of McVay Real Estate via expressions of interest closing 28th March.
Developed in 2013 by Hansen Yuncken for Pacific Shopping Centres, the four-level Rundle Place retail centre also has a seven-level, 506-space car park and a gross lettable area of 23,265 sqm. Anchored by Adelaide’s only full-line Coles supermarket and Harris Scarfe’s flagship, it is also home to South Australia’s only Apple store, as well as five mini-majors, 48 specialty shops and 12 kiosks.
It is currently 98% occupied and has a 7.6-year weighted average lease expiry. Tenants include Ted Baker, Country Road, Trenery, Witchery, Sussan, Seed Heritage and Kookai, and large roster of food and beverage operators.
The agents are marketing the property as the Adelaide’s CBD’s only premium-grade retail asset, and with “significant value-add potential to accommodate a mixed-use development”.
South Australia’s abolition of stamp duty last year could generate stronger interest in the asset, having played a role in Blackstone’s sale of 80 Grenfell Street. Centuria cited the state’s attractive stamp duty regime as a factor in its acquisition.
While stamp duty across other states averages around 5.5%, South Australia had taken its down to 1.8% at the time of the 80 Grenfell Street transaction, before abolishing it entirely from July.
Rundle Place attracts 10.7 million visitors annually, while Rundle Mall receives 24 million visitors and has traditionally boasted among the lowest vacancy rates of the city’s shopping precincts.
Another major component of the precinct, Rundle Mall Plaza, recently welcomed Swedish fast fashion giant H&M as its new anchor as part of a $40 million redevelopment of the double-storey, 3,000 sqm centre on the corner of Gawler Place.
Australian Property Journal
