This article is from the Australian Property Journal archive
VICINITY Centres has completed the selldown of assets out of a wholesale fund, with the $81.1 million divestment of Mildura Central in Victoria to IP Generation.
The sale represents a yield of above 9%. Vicinity paid $109.75 million for the property in 2014, acquiring it for the unlisted Vicinity Enhanced Retail Fund that was run on behalf of Vicinity’s super fund investors.
Assets have been sold over the last few years. Most recently, Riverside Plaza in the ACT was offloaded to Elanor Investors Group for $60 million, following $113 million sale of Keilor Central in Melbourne’s north-west, the 33,000 sqm Lidcombe Centre in Sydney to a private investor in October for $145 million, and the Gateway Plaza shopping centre on the Bellarine Peninsula for $117 million earlier in 2018.
Perched on 7.35 hectares of land, Mildura Central is anchored by Kmart and has a Target, a high-performing Woolworths and specialty tenants.
Vicinity sold Corio Central to IP Generation late in 2019.
Colliers’ Lachlan MacGillivray managed the sale.
A recent m3property report suggested centres in regional locations with high levels of competition, and major tenant backfill risk will be hardest impacted by the pandemic, however the nearest sub-regional shopping centre to Mildura Central is some 340 kilometres away in South Australia.
Research from The Data App shows the change in shopping centre demand has been reflected in the valuation parameters, with the prices per sqm for popular convenience, neighbourhood and large format retail assets around 12% higher than a year earlier, while cap rates have also tightened. However, the cap rate for sub-regional shopping centres has increased over the past 12 months.
