Stockland and AMP Capital have disposed of a shopping centre in Townsville, Queensland to a Sydney-based investor syndicate for $47.25 million, reflecting a fully leased yield of 5.46%.
The Coles Kmart Plaza Townsville asset is a 13,892 sqm sub regional centre with tenants including Coles, Kmart, one mini major and 21 specialty stores.
The property is located on a 42,000 sqm site diagonally opposite the Stockland Townsville regional shopping centre and about 5km south of Townsville Airport. It has a weighted average lease expiry (WALE) of 4.6 years.
Stonebridge Property Group and JLL managed the expressions of interest campaign.
“The strong performing Coles and Kmart stores underpinned investment demand for this asset, with groups also attracted to the opportunity to add-value via specialty leasing and remixing,” said Jacob Swan of JLL.
“Convenient, essential service focused retail assets in immediate proximity to major regional shopping centres, as is the case for Coles Kmart Townsville, have traditionally always been held in high regard by investors.”
Stonebridge’s Jonathon Fox said it was a strong result and reinforced the strength of demand for convenience-based assets.
“Interstate buyers accounted for the significant majority of offers, despite being unable to inspect due to COVID lockdowns. The capital pool is deep for assets of this scale, creating highly competitive sale processes which are resulting in yield compression and limited conditionality,” Fox said.
The deal follows a standout year for retail real estate investment in Queensland last year, with about $3.7 billion in retail deals transacted across the state, according to CBRE.
Last month, YFG Shopping Centres bought the Strathpine Centre in Brisbane for $267 million, and AMP Capital, UniSuper and Cbus Property purchased the remaining 20% of the Pacific Fair shopping centre on the Gold Coast for $336.4 million.
Other recent Queensland deals include Greenpool Capital and Qualitas paying $132 million for the remaining 50% interest in the Gold Coast’s Runaway Bay Centre and Vicinity Centres’ acquisition of a 50% stake in the Gold Coast’s Harbour Town outlet centre for $358 million in October.
In Queensland’s Hervey Bay, a new Bunnings store under construction sold for $58.6 million last month, setting a new national yield record of 4% for the hardware retail chain.
Outside of the state, Primewest bought a Woolworths-anchored retail centre under construction in Sydney from Fridcorp for $41.5 million last week, while the AMP Capital Shopping Centre Fund acquired an additional 25 per cent stake in Sydney’s Macquarie Centre for $422.5 million.
Link REIT bought a 50% stake in three retail properties in Sydney from GIC for $538.2 million, in addition to CIP Asset Management’s sale of a 50% stake in Sydney’s Roselands shopping centre to JY Group for $167 million.
2021 was a significant year for Australian retail real estate investment – check out Australia’s biggest retail property deals of 2021.