This article is from the Australian Property Journal archive
PERTH-based commercial property company Hawaiian has taken full control of Claremont Quarter, buying Queensland Investment Corporation (QIC)’s half share in a deal that brings major retail transactions in Western Australia to $1.6 billion since the start of 2023.
The $207 million sale of the stake was struck above book value. It lands the same week as Vicinity Centres settling on its purchase of a half stake in Lakeside Joondalup for $420 million from the Future Fund – some $230 million below what was expected for a half stake in the asset six years ago.
CBRE’s Simon Rooney and McVay Real Estate Sam McVay and Dan McVay managed the sale on behalf of QIC.
“Claremont Quarter is a genuine fortress mall, positioned in one of Australia’s most affluent trade areas. Its unique tenancy mix and strong productivity levels make it an exceptionally rare offering that will deliver above market income growth for the foreseeable future,” Sam McVay said.
“The response that we had was incredible and testament to the deep demand that great assets generate at all times of the cycle,” Sam McVay added.
Claremont Quarter offers a gross lettable area of 29,766 sqm and is securely anchored by David Jones, Coles and Jack’s Whole Foods & Groceries, supported by five mini-majors and 108 speciality stores and kiosks. Tenants include a range of leading retailers such as Zimmermann and Sass & Bide alongside international luxury lifestyle brands Chanel and Georg Jensen.
A laneway food and beverage and dining project is due to be completed and operating by the end of October.
The centre occupies a strategic 2.7-hectare site 100 metres north of the Stirling Highway.
Rooney said the sales process generated considerable investor engagement from both domestic and offshore groups, institutional and private capital as well as local high-net-worths and family offices ahead of Hawaiian exercising its rights.
“There are limited opportunities to secure holdings in dominant and strong performing shopping centres, in this case one located in what has historically one of the more tightly held markets in Australia.”
Claremont Quarter is underpinned by one of Australia’s most affluent catchments with high retail spending, driving the centre’s impressive turnover performance, he said. Incomes in the main trade area are 37% above the Perth metropolitan average and 43% above the national Australian average.
Rooney said the pair of Western Australian retail transactions this week showed “strengthening demand for regional shopping centres following a market recalibration”.
Recent major deals include Midland Gate selling for $465 million to Hong Kong private investment firm PAG and Fawkner Property, below initial expectations, and GIC’s 50% interest in Westfield Whitford City for $180 million to JY Group.
Meanwhile, Vicinity Centres sold off Maddington Central to Realside for $107 million, at a 10% uplift to book value, as well as Dianella Plaza for $76.25 million to Greenpool Capital, Centuria Capital bought the Halls Head Central sub-regional centre from ISPT for $70 million.
The Western Australian retail market has strong fundamentals, benefiting from population growth, booming commodity prices, strong residential value growth, higher levels of disposable income compared to the national average and a relatively affordable cost of living.
Rooney said the wealth effect from increases in house prices should be a boon for renovation and homeware spending in shopping centres.
