This article is from the Australian Property Journal archive
ISPT is looking to sell off its 50% stake in Warriewood Square, a sub-regional shopping centre on Sydney’s Northern Beaches.
The 30,344sqm dominant shopping centre is co-owned and managed by Vicinity Centres and is anchored by national retailers Woolworths, Coles, Aldi and Kmart, with five major minis including Rebel, Cotton On Mega and JB Hi-Fi, plus 98 specialty stores and kiosks, plus 1,080 carparks.
Simon Rooney from Pacific Head of retail capital markets at CBRE has been appointed to manage the sale via an expressions of interest campaign.
“The sale provides an opportunity for investors to gain a foothold in one of the most tightly held investment destinations in Australia, with just six sub-regional shopping centre transactions occurring in metropolitan Sydney since 2020,” said Rooney.
“We expect Warriewood Square to be well contested by a range of domestic and offshore groups given the centre’s strong trading performance, solid investment fundamentals, metropolitan Sydney location and secure tenancy profile.”
ISPT acquired its stake in July 2013, with the asset valued at $131.5 million in December 2023, with a cap rate of 6.00%.
The asset, which is located 29km north-east of the Sydney CBD, was built in 1980 and underwent a $85 million redevelopment in 2016 and serves an established affluent trade area of 109,000 residents, whose incomes come in 13% above the Sydney benchmark.
Last year, Warriewood Square was visited by around 4.1 million customers and saw combined annual sales in excess of $100 million.
As at December 2023, the centres MAT was at $250.5 million, with MAT per sqm at $9,155 and specialty MAT per sqm at $9,241 and specialty occupancy costs at 17.2%.
For ISPT, the sale comes as the fund manager continues to shift its focus from the retail and office sectors towards industrial, health and life sciences.
Having recently put three super-prime industrial assets in Sydney and Brisbane on the market, with combined expectations of $250 million.
ISPT sold the Brisbane CBD home of fast fashion giants H&M and Uniqlo, 170 Queen Street for $145 million last October and listed a portfolio of four key retail assets and an office building to the market with combined expectations tipping around $600 million.
Though the group has recently increased its investment in Fort Street having, acquired a 75% stake in Fort Street Real Estate Capital (FSREC) three years ago and a 95% stake in the FSREC Property Fund, and has increased its investment to 100% and 98% respectively.
The fund manager is also undertaking its third major office retrofit, with a $170 million investment into 270 Pitt Street, which it looked to sell just last year.
The expressions of interest campaign for Warriewood Square is scheduled to close in mid to late September 2024.
