This article is from the Australian Property Journal archive
HABEN Property Fund and Hong Kong investor The JY Group have acquired Casey Central from UK investment giant M&G Investments for $225 million in Victoria’s largest sub-regional shopping centre sale in five years.
Colliers’ head of retail Lachlan MacGillivray handled the sale on behalf of M&G which put the property on the market in April this year after receiving a number of unsolicited approaches.
“We are very pleased with the outcome achieved via a highly competitive sale process for Casey Central, with the fund delivering a strong outcome for its’ investors,” James MacKinnon, head of Australia, real estate at M&G Investments said.
“The asset has shown incredible resilience through a challenging last 12 months and we have been very pleased with its performance over our period of ownership,” he added.
M&G acquired the property in late 2016 from Westfield spinoff Scentre Group for $220 million on a yield of 5.25%, after Scentre spent $155 million on a makeover, in the largest sub regional shopping centre sale of the year.
Casey Central was just a small neighbourhood centre when Westfield bought it in 2005 with a total GLA of 6,500sqm, 23 shops.
“We are delighted with the acquisition of Casey Central. We are very focused on the long term growth fundamentals of the asset and see opportunity to build on the strong foundations that M&G put in place during their ownership.” Haben’s managing director Ben Finger said.
The acquisition will boost Hong Kong-based The JY Group’s Australian portfolio.
The group along with Asia’s ultra-high-net-worth families also own the Doncaster Pines and Brimbank shopping centres in Melbourne, as well as the Cairns Rydes Esplanade Resort.
MacGillivray said the sale brought the total volume of sub regional transactions for the year to more than $1.2 billion.
“Casey Central is one of the best quality town centres that we have seen offered to the market in recent times.
“It ticked all the boxes that astute investors were looking for in that it offered a secure tenant profile, limited required capital expenditure and is perfectly positioned to capture the future growth potential of the trade area,” he added.
This transaction comes as research from The Data App shows shopping centre transactions reached a multi-year high in the June quarter after slumping at the height of the COVID-19 lockdowns.
“The buoyancy of shopping centre transactions reflects, on the one hand, the desire to offload large shopping centres while, on the other hand, there remains a strong appetite for convenience, neighbourhood and large format centres,” The Data App’s director Rob Ellis said.
MacGillivray said there is currently more than $2 billion in unsatisfied capital aggressively pursuing retail centres that offer these characteristics, as witnessed in recent market transactions including The Square Mirrabooka and CS Square.
Last week HomeCo’s Daily Needs REIT acquired the TownCentre Victoria Point in south east Brisbane for $160 million and the Charter Hall Long WALE REIT and Abacus Property Group acquired the Myer Melbourne flagship store for $135.2 million.
“Assets such as Casey Central rarely come to market. The centre is well equipped to serve the needs of the growing, family-based local community,” he continued.
Located at 400 Narre Warren Cranbourne Rd, Narre Warren, 47km south-east of Melbourne’s CBD, the centre comprises 28,700 sqm of space and 1,367 parking spaces on a 10ha site.
MacGillivray said low site coverage of 29% allows an incoming investor ultimate flexibility to drive the long-term performance of the site.
The centre is anchored by Coles, Woolworths, ALDI and a brand-new Kmart discount department store. Together, major tenants occupy 54% of the total GLA. The strong security of income is underpinned by a major tenant Weighted Average Lease Expiry of 14.4 years by income.
