Vicinity Centres has bought a 50% stake in the Gold Coast’s Harbour Town outlet centre in Queensland from a Lendlease-managed fund for $358 million.

The Harbour Town retail asset has 55,693sqm of gross lettable area, with more than 200 stores including Woolworths and Reading Cinemas.

Lewis Land Group will retain its 50% interest in Harbour Town and continue to manage the property, while Vicinity will manage the centre’s leasing activity.

“Harbour Town is located in an attractive trade area and the centre’s annual [moving annual turnover] is more than double the average MAT for Vicinity’s current outlet portfolio and is expected to grow at more than 3% per annum to 2031,” said Vicinity CEO and Managing Director Grant Kelley.

“We will continue to optimise our asset portfolio by actively considering acquisition opportunities where we can add value as well as divestment opportunities that make strong strategic and economic sense for Vicinity and its securityholders.”

Vicinity said there were opportunities to leverage its retail partnerships to introduce new brands into the centre, as well as the potential to elevate the centre with more defined outlet, food and leisure precincts.

The deal comes as Australia’s retail property market continues to recover from low sales volumes recorded in mid-2020, with transaction volumes increasing 11% to $7.3 billion during the 2021 financial year, according to JLL research.

Vicinity bought the property stake at a capitalisation rate of 5% from Lendlease’s wholesale fund, Australian Prime Property Fund Retail (APPF Retail).

“This is a very good outcome for our investors and is in line with the fund’s capital management strategy that includes providing liquidity to our investors who have sought it,” said Scott Mosely, Managing Director, Investment Management at Lendlease.

“APPF Retail is focused on executing its urban growth centre strategy, incorporating mixed use placemaking to create vibrant precincts that support changing consumer needs around lifestyle, technology and shopping.

“The delivery of the fund’s urban growth strategy has been accelerated, with recent examples including the opening of the high ropes adventure course at Sunshine Plaza in Qld and approval for a seven-storey office development with childcare facilities at Lakeside Joondalup WA.”

The disposal follows the sale of a shopping centre in Geraldton, WA from Lendlease’s Sub Regional Retail Fund for $71.2 million earlier this week.

CBRE’s Simon Rooney and Sam McVay and Dan McVay from McVay Real Estate managed the deal.