This article is from the Australian Property Journal archive
ACTIVITY in Perth’s retail market is gaining momentum, with Mair Property Funds acquiring the Wattle Grove shopping centre for $16.3 million as other major assets hit the market.
The 3,103 sqm Aldi-anchored centre at 338 Hale Road in Wattle Grove was completed in 2016 and has medical, pharmacy, dental, restaurant and fast food tenants.
It was acquired from Western Australian developer Devwest and will be placed in the unlisted MPF Retail Fund, which also holds the Castle Hill Village Shopping Centre in Murrumba Downs, north of Brisbane.
“This second asset forms an integral part of our wider acquisition strategy by providing the fund with diversity of location to help us better leverage growth opportunities within different markets across Australia,” Mair Property Funds said.
“With the Wattle Grove catchment forecast to grow by 3.6% in the next five years, we identified a key opportunity in the new shopping centre to take advantage of the growing population and high demand dynamics in the local area, with the site already benefiting from approximately 17,500 vehicles passing by per day.
“The centre is also well poised to benefit from the completion of the highly anticipated Forrestfield rail link and the expansion of Perth’s airport, both of which will help drive further traffic to the area.”
Meanwhile, a group of Perth-based developers have listed the recently completed Trinity Village shopping centre in the north-west suburb of Alkimos for sale, as neighbourhood centres in Western Australia change hands in growing numbers.
CBRE’s Richard Cash and Anthony Del Borrello are marketing the Coles-anchored Trinity Village via expressions of interest closing 4th April.
Completed in 2018, the centre has a lease to the Coles supermarket of 3,765 sqm until February 2033, and is on a 2.16-hectare site with 16 specialty retailers the include F45 Training, Juniper Medical Centre and a Shell petrol station.
Located opposite the new Butler secondary school, the high exposure corner site has four street frontages.
Cash said the sale would capitalise on strengthening investor interest in Perth’s retail investment market.
“Neighbourhood shopping centres anchored by strong national tenants, such as Coles and Woolworths, continue to be highly sought after by investors due to the heavy reliance on non-discretionary spend and insulation from online sales,” he said.
Del Borrello said the sale campaign followed strong recent activity in WA’s shopping centre sector.
Neighbourhood centre transactions increased from three in 2017 to 12 in 2018, including Vicinity Centres’ sale of Flinders Square for $39.5 million at a 6% yield, and Woolworths Aveley trading for $26.925 million at a 5.75% yield.
Trinity Village returns a fully leased net income of round $2.2 million. A transaction figure reflecting a 6% yield would come in at more than $36 million.
“The current strong yields are reflective of a flight to secure investments that are weighted by strong ASX listed tenants, with the potential for future growth of income in line with performance,” Del Borrello said.
“The current owners of Trinity Village are looking capitalise on the current yields on offer for neighbourhood shopping centres, seeing this as an opportune time to divest the asset and move into another development.”
Earlier this month, Woolworths put Banksia Grove shopping centre at 81 Ghost Gum Boulevard to the market with hopes of fetching $35 million. Another recently completed centre, having opened in November 2017, it has a 3,850 sqm Woolworths and 14 specialties.
Australian Property Journal
