- A 50% non-managed interest in Perth's Westfield Whitford City is on the martket with Colliers.
- Westfield Whitford City underwent a revamp in 2017, adding a vibrant entertainment and dining precinct.
- Plans have been drawn up for further development including for 87 residential apartments and 3,720 sqm of office space.
A 50% non-management interest in the popular Westfield Whitford City has been listed for sale, with Colliers‘ Lachlan MacGillivray exclusively appointed to steer the expressions of interest campaign.
The well-performing retail and entertainment hub is situated in the northern Perth suburb of Hillarys, surrounded by some of the city’s best-placed real estate.
“Westfield Whitford City is an integral part of the social and economic fabric of the Perth’s northern suburbs.”
Lachlan MacGillivray, managing director, Asia Pacific, retail capital markets, Colliers
The opportunity is set to attract interest from a range of investors to the tune of $250 million, owing to plans that have been drawn up for the construction of an eight-story building with 87 apartments, a three-story office building totalling 3,720sqm of Net Lettable Area, and a plaza.
Real Estate Institute of Australia’s (REIA) Hayden Groves said that the success of residential developments at major retail centres in other parts of Perth, combined with the Whitfords area’s relative lack of high-density residences will contribute to the success of any future developments.
“The likelihood of increased housing density in and around the centre is high. Dominated by detached housing, the region is starved of medium to higher-density affordable housing options. Higher density around shopping centres elsewhere across Perth has proven successful.”
Hayden Groves, CEO, Real Estate Institute of Australia
In 2017, work was completed on an entertainment precinct that included an eight-screen cinema, a bowling alley, and a high-quality mix of dining options.
With a total Moving Annual Turnover (MAT) of $499.6 million, the centre caters to a large trade area population of 458,210, and received 6.7 million annual customer visits as of April 2023, with an average spend of $67 per person.
McGillivray said that instability in traditionally secure regions for retail management investment, such as Europe and America, is forcing overseas investors to take a second look at the Asia-Pacific region for gainful opportunities.
“Westfield Whitford City is also a land-rich asset with mixed use potential offering significant future options.”
Lachlan MacGillivray, managing director, Asia Pacific, retail capital markets, Colliers
The Asia-Pacific retail real estate market is becoming an attractive one for retail property investors, with some suggesting the unexpected resilience of the luxury sector, and the increasing popularity and preference for “experiential” shopping is a driving factor of this.
Experiential shopping is defined as a rich, immersive shopping experience.
Think Louis Vuitton window displays on the Champs Elysees with Parisian architecture as a backdrop providing a preview to a carefully laid out, gilded interior, where you are attended to by very well-dressed and groomed shop attendants.
“This region attracts affluent migrants from South Africa and the United Kingdom, giving Whitford City a solid consumer base in future years.”
Hayden Groves, CEO, Real Estate Institute of Australia
The trend has been identified as being more clearly present in suburban shopping malls such as Westfield Whitford City. The aforementioned entertainment precinct, within the centre, positions it as the perfect place for shoppers to indulge in a more complete shopping experience.
According to the 2021 census, the postcode immediately surrounding the centre has a median age of 40 and a median weekly household income of over $2,000.
Considering the median monthly mortgage repayments were at an easily serviceable $2,000 as of 2021, it could be expected that in 2023, with interest rates higher, the location is still a relatively good investment, benefiting from higher-than-average disposable incomes in its immediate vicinity.
The same census found that the average disposable income in greater Perth was just under $1,200 per week.
Residential property prices near Westfield Whitford City show the appeal for buyers in the north of Perth. The market there represents a relatively stable investment, with residential property values rarely diving too far, especially compared to, what some would term, riskier postcodes further south.
Asking property prices for Hillarys 6025
Westfield Whitford City is currently owned by Scentre Group, a private company whose major shareholders include Vanguard Investments Australia Ltd., The Vanguard Group, Inc., Franklin Templeton Australia Ltd., and BlackRock Investment Management (Australia) Ltd.
With retail markets elsewhere slowing, real estate experts in Australia point to the region’s stable sales performance as an indicator of the relative security of APAC real estate investments, particularly in retail.
“The Asia Pacific region represents medium to long-term investment opportunities in an emerging market not found anywhere else in the world. Bespoke, mid-range retail goods appealing to the growing aspirational demographic where buyers are seeking to ‘touch and feel’ products make retail real estate a future-proof investment.”
Hayden Groves, CEO, Real Estate Institute of Australia
APAC investment opportunities in WA such as Westfield Whitford City may prove to be a good place for global investors to park their money, but time will tell whether the centre’s comparatively limited luxury offerings show lasting appeal in Perth’s volatile retail market.
Australia’s retail sales growth, like residential property prices in some areas such as Hillarys, seems undeterred by the RBA’s assault on household budgets, modestly rising or staying flat in the first half of 2023.
Applications of interest close at 2 pm (AEST) on Wednesday, 26 July 2023.
