Stockland have continued their divestments of shopping centres with The Pines Shopping Centre in Doncaster, Victoria being sold for $155 million. The transaction marks one of the first retail assets to settle in 2021 as private capital continues to invest in the Australian retail market.
The Pines Shopping Centre is a 25,000m2 convenience based sub-regional asset, occupying a substantial 7.75 ha landholding in metropolitan Melbourne. The transaction was exclusively negotiated off-market by JLL’s National Retail Investments Team – Sam Hatcher, Nick Willis and Stuart Taylor.
“Shopping centres with strong underlying land value were keenly sought during 2020, a trend we see continuing during 2021. These transactions tend to reflect the tightest yields as they provide multiple options in the future” Hatcher said.
The Pines Shopping Centre has a highly sought-after triple supermarket anchor profile, featuring Woolworths, Coles and ALDI supermarkets, and is further supported by a Kmart DDS. The major tenant profile anchors 66% of the total lettable area and bolsters the asset WALE to five years (by lettable area).
“Discount department stores have come under pressure given their focus on downsizing (most recently Target & Big W). However, Kmart and Big W were both beneficiaries through the lockdown period, with Big W reporting comparable sales growth of 31.8% in the June quarter and 22.3% in the September quarter,” Willis said.
The Pines Shopping Centre was negotiated as a portfolio deal with Caloundra Shopping Centre situated in Queensland. Both centres were sold to a local Sydney based syndicate for a combined sale price of $252 million.
“Syndicators and private investors continue to see relative value in retail assets and were net buyers throughout the past three-years (2018-2020) and have actively been seeking value-add opportunities in sub-regional centres. In 2020, syndicates represented 35% of sub-regional market share (by value), which has substantially increased from 4% market share in 2018,” Taylor said.
Despite a pandemic year and extended lockdown restrictions in Victoria, The Pines Shopping Centre recorded an MAT in excess of $173 million in SCN‘s 2020 Little Guns report.