This article is from the Australian Property Journal archive
SAM Arnaout’s Iris Capital is selling the retail precinct within its $1 billion East End development that is transforming downtown Newcastle.
East End Village is an inner-city shopping precinct occupying 2,768 sqm net lettable area, anchored by Woolworths Metro and complemented by 14 specialty stores.
JLL’s Nick Willis and Dylan McEvoy together with Commercial Collective’s Adam Leacy have been appointed to run an expressions of interest campaign, with enquiries expected from high-net-worth individuals and retail-led institutional groups.
The retail precinct forms part of stage one of the newly opened East End Village development, consisting of three mixed-use buildings clustered around a small public piazza, accommodating 206 apartments.
Iris Capital has just opened the 104-room QT Newcastle hotel at the Scotts Ltd and David Jones building.
Stage two is under construction and includes 112 units plus five terrace-style houses, while stages three and four are still in planning but are expected to provide approximately 300 additional units upon completion.
East End Village will service a wide geographical catchment with a total trade area of 173,000, with an additional 30,000 within a three kilometre radius.
The East End project is estimated to be home to around 1,500 residents living across the four stages of the development in the next five years. It is being built across four blocks that Iris Capital picked up in 2016 for $39 million.
There are an additional 1,400 homes across 10 development projects surrounding Newcastle.
“The centre is positioned to capitalise on the residential units to be developed within its main trade area, as well as benefit from the newly opened QT hotel within the precinct,” McEvoy said.
East End Village is 100% occupied and is underpinned by daily needs, food and services tenancy mix providing a total net income of $2.27 million, with a 3.4-year weighted average lease expiry (WALE).
“We’re absolutely delighted with the success of what we have created within the precinct in particular the quality of businesses that have been drawn into Newcastle CBD and East End Village,” Arnaout said.
“Given retail is not within our core business and the fact that we are almost at 100% occupancy, we have decided to sell the asset and redeploy capital to other projects.
“Stages three and four of the East End Village will also now become our primary focus.”
Investment supply in the convenience retail sector has been relatively constrained this year after a busy 201 that saw overall retail trade at 46% higher than any other year, totalling $12.9 billion.
Expressions of interest close 3rd August.
Iris Capital this month fast-tracked the second launch of its $800 million V&A Broadbeach mixed-use development on the Gold Coast.
