This article is from the Australian Property Journal archive
UNISUPER and Cbus Property have bought major key stakes in AMP Capital’s Pacific Fair and Macquarie Centre malls for $2.2 billion in Australia’s largest-ever retail property transaction.
The superannuation fund and property investor and developer are now partners in the AMP Capital Retail Trust (ACRT).
They have taken majority ownership of Pacific Fair on the Gold Coast and a 50% ownership of Macquarie Centre in Macquarie Park, on Sydney’s North Shore as vaccination rates reach high levels and Australia begins to move into a post-COVID phase.
Dexus had taken on respective 20% and 25% interests in the assets earlier this year when its wholesale fund merged with the AMP Capital Diversified Property Fund to create a $15 billion fund, and put the stakes to the market last month with hopes of $700 million.
The 150,000 sqm Pacific Fair Shopping Centre underwent a $670 million refurbishment five years ago is the country’s fifth-largest shopping centre by GLA and is within the top 10 performers with $890 million in moving annual turnover.
Meanwhile, the 135,000 sqm Macquarie Centre is Sydney’s offers medium-term mixed-used development potential with approval for 148,000 sqm of gross floor area.
The deal arrives hot on the heels of Vicinity Centres acquiring a 50% interest in Harbour Town Outlets Gold Coast from Lendlease’s Australian Prime Property Fund Retail for $358 million, while GPT has confirmed it is in discussions with buyers for the Casuarina Square in Darwin and Wollongong Central shopping centres for a speculated combined sum of more than $820 million.
Meanwhile, Hong Kong’s Link REIT is speculated to be eyeing off as much as $550 million worth of stakes in Sydney CBD shopping centres The Queen Victoria Building, The Galeries and the Strand Arcade from Singaporean fund GIC.
However, the more recent retail asset sales closer to this size were seen in 2019, such as a 50% stake Westfield Marion in South Australia selling for $670 million to Singapore Press Holdings – at a discount to book value, prior to the pandemic – and a 50% stake in Garden City Booragoon in Western Australia for $575 million to Scentre Group.
AMP Capital’s head of real estate, Kylie O’Connor, said the deal demonstrates the returning confidence investors have in the retail sector, particularly for high-quality, well-managed assets.
“Since 2012, AMP Capital has overseen the redevelopment of the assets on behalf of investors to enhance the retail offering and trade area dominance of Pacific Fair and Macquarie Centre.
“As we move closer to operating under the demerged private markets business, we look forward to working with our partners to unlock future opportunities at each asset, both of which are in prime locations within exceptional trade areas.” O’Connor said. “This includes further strengthening performance with innovative retail solutions and capitalising on their mixed-use potential, including Macquarie Centre’s mixed-use DA.”
UniSuper’s head of property and infrastructure, Kent Robbins, said, “We anticipate an increase in returns from certain shopping centres as retailers seek exposure to dominant shopping centres, such as Macquarie Centre and Pacific Fair, to leverage their omni-channel retail plans.”
The deal was facilitated by the AMP Capital Real Estate team in conjunction with the vendors’ advisers, Colliers’ Lachlan MacGillivray, as well as Morgan Stanley’s chairman of investment banking, Australia, Tim Church and head of real estate, Australia, Craig Smith.
ACRT was established in 2012 with foundation investors Canada Pension Plan Investment Board, Abu Dhabi Investment Authority subsidiary Harina Company Limited, and AMP Life Limited, which had its interest transferred into the AMP Life Property Fund.
