Midland Gate, the dominant regional shopping centre in Perth’s fast-growing north-eastern metropolitan corridor, has been listed for sale as major investors increasingly expand their focus to top-end retail investment opportunities.
This follows a record year for retail transactions in 2021, which has underpinned renewed investor confidence and purchaser engagement for larger retail assets.
Vicinity Centres has appointed CBRE’s Pacific Head of Retail Capital Markets Simon Rooney and Colliers’ Asia Pacific Head of Retail Capital Markets, Lachlan MacGillivray, to sell the 100% freehold interest in Midland Gate together with management rights on behalf of a mandate client and Vicinity Retail Partnership.
The prominent centre occupies a substantial 14.4ha town centre site at the gateway to Perth’s burgeoning north-eastern population growth corridor. Comprising a GLA of 68,600m2, the centre is securely anchored by a highly productive triple supermarket offer of Coles, Woolworths and ALDI, in addition to discount department stores Kmart, Big W and Target and an eight-screen Ace Cinemas complex.
“The value proposition for regional shopping centres is now increasingly compelling for investors, given the attractive, superior comparative returns on offer, compared to most alternative commercial property asset classes, where pricing levels continue to be at historic highs,” Rooney said.
“As retail fundamentals continue to reset for high-quality assets and move into a clear growth phase, domestic and offshore investors are proactively re-engaging and seeking out top-end shopping centre investment opportunities such as Midland Gate. This is evidenced by the strong demand for recent major transactions such as Macquarie Centre and Warringah Mall in Sydney and Pacific Fair and Harbour Town Premium Outlets in south-east Queensland.”
Midland Gate recently underwent a major $100 million redevelopment and expansion, which has contributed to its robust trading fundamentals.
MacGillivray adds: “The centre’s impressive productivity, strong performance, strategic growth corridor location and surrounding transport infrastructure will help drive significant competitive investor interest.
“Western Australia’s retail sales growth has consistently outpaced the national average, with the State having recorded retail sales growth of 2.6% on average over the past decade, outperforming the national average by 40 basis points.”
Midland Gate is the only regional shopping centre in its trade area, which is experiencing attractive population growth.
The expansive current trade area of 265,630 residents is growing by 1.8% per annum and is anticipated to reach 318,560 people by 2031.
The centre is also expected to benefit from significant food expenditure within the trade area of $2.5 billion per annum, which is forecast to grow by 4.1% p.a. to reach $3.7 billion by 2031.
The asset’s town centre location, proximity to the Perth CBD and heavy rail infrastructure, and position in the city’s north-eastern growth corridor is anticipated to provide an incoming purchaser with the potential to develop a long-term, future mixed-use development strategy.
International Expressions of Interest to purchase Midland Gate close on Thursday 7 April 2022.