This article is from the Australian Property Journal archive
FUND manager ISPT has furthered its shopping centre selldown, and Vinta is looking to offload major Gold Coast lifestyle mall The Strand at Coolangatta as fluidity returns to the retail sector.
Shopping centre fundamentals are “generally positive” and “it appears investors are waking up to the positive story”. Vacancies have held steady despite the weak sales environment, occupancy costs lower than prior to the pandemic, and a lack of new shopping centre supply.
Over the past year, the discount to net asset value for listed retail REITs in Australia has narrowed from 13% to 3%.
Looking to take advantage of the more favourable environment, Vinta has offered up The Strand at Coolangatta, which has 30,000 sqm of floor space and is perched between the surf breaks of Snapper Rocks and Kirra, offering Australia’s widest beachfront retail holding.
The Strand is anchored by Woolworths and supported by a range of daily needs tenants, features a Timezone and a brand-new Cinebar cinema, is home to the Boardriders flagship store and waterfront dining precinct overlooking Coolangatta Beach. It integrates with the historic “Cooly” Hotel, which has operated since 1911, and is further supported by Gold Coast dining institution George’s Paragon.
There are 664 basement parking spaces, the largest in the catchment.
JLL has the listing.
“Opportunities to acquire largescale dominant shopping centres in the heart of precincts like this are seldom available,” said JLL’s Nick Willis.
Including The Strand, there are only six institutional grade assets that are genuinely located within the Gold Coast’s core of the beach precinct, he said, with the other five assets either privately held by intergenerational owners or institutions that have long-term holds.
“The Strand provides an opportunity for investors to acquire an asset set to capitalise on the outstanding population growth and surrounding gentrification of this world-famous location, just minutes from the airport and new luxury residential developments.”
He said that whilst the stock of $100 million-plus retail assets remains tightly held nationally, those being traded are typically in regional or non-core markets.
“The Gold Coast is a core market providing robust growth fundamentals aligned with the requirements of global capital investors. We are witnessing increasing engagement from investors for the sector.”
ISPT furthers selldown
Meanwhile, ISPT has continued its pivot from retail towards the health and life sciences sectors, offloading Dee Why Grand shopping centre in Sydney’s Northern Beaches for $60 million to a high-net-worth private investor.
JLL and Stonebridge managed the sale.
Dee Why Grand is a 9,976 sqm dual-supermarket neighbourhood centre, anchored by Coles and Aldi, along with a mix of specialty retailers. Overall, its tenancy mix is 94% weighted to convenience services and health uses.
The sale marks just the fifth dual-supermarket neighbourhood centre sale within 15 kilometres of Sydney since 2010.
It comes little more than a week after ISPT’s Core Fund lobbed a 50% stake in sub-regional centre Warriewood Square, also in the Northern Beaches, to the market. The centre received an $87 million upgrade in 2016.
ISPT has also been shopping around the triple-supermarket anchored Market Central Lutwyche, alongside co-owner Abacus, five years after the centre underwent a $77 million redevelopment.
Last year, it sold the Brisbane CBD home of fast fashion giants H&M and Uniqlo, at 170 Queen Street for $145 million, just as it put a portfolio of four key retail assets and an office building to the market with combined expectations tipping around $600 million.
The retail assets include Melbourne’s GPO building, The Strand Melbourne, Halls Head Central and Eastgate Bondi Junction. It has since Eastgate Bondi Junction to Charter Hall for nearly $127 million, and the Coles and Aldi-anchored Halls Head Central sub-regional centre for $70 million to Centuria Capital Group, at 40% below replacement cost.
Retail momentum growing
Deal-making momentum is gaining in the retail sector. ASX-listed Vicinity Centres recently sold off Maddington Central in Perth for $107 million, at a 10% uplift to book value, while IP Generation’s acquired Stockland Glendale for $315 million in the largest retail transaction of 2024 to date – edging out Scentre and Barrenjoey’s $308 million purchase of a half-share in Westfield Tea Tree Plaza in Adelaide.
