Benowa Gardens IJ Capital
IJ Capital have sold the Benowa Gardens shopping centre to a private investor for $60.5 million, reflecting an uplift in capital of 50% in under two years. Image – Supplied
  • IJ Capital has sold Coles-anchored Benowa Gardens to a private investor for $60.5M
  • Sale reflects a 50% uplift in under two years, a success for IJ Capital who saw value-add opportunities in the asset
  • Neighbourhood centres remain popular asset class due to stability, says Peter Tyson of Savills

A Gold Coast shopping centre has sold for $60.5 million to a private investment group, marking yet another multi-million dollar retail transaction in the state.

The Coles-anchored Benowa Gardens shopping centre, located on the corner of Ashmore and Benowa Road, sold for a passing yield of 4.99%.

The centre was formerly owned by Brisbane-based fund manager, IJ Capital, who represented in the sale by Peter Tyson of Savills.

IJ Capital purchased the asset from diversified property group Stockland in early 2020 for $40.1 million, a transaction also overseen by Savills, and since renovated the property.

Successful value-add opportunity for IJ Capital

The enclosed neighbourhood mall sits on a site spanning 17,660 sqm and comprises of a Coles supermarket, 37 specialty tenancies and a freestanding KFC drive-through restaurant.

With a total gross floor area of 5,856 sqm and parking capacity for 384 cars, Benowa Gardens is a well-trafficked retail centre located just four kilometres west of Surfers Paradise.

The centre has been a successful asset for IJ Capital, who focus on investing in assets with strong return metrics and value-add opportunities.

“IJ Capital’s focus is identifying market-beating returns for our investors,
including significant capital growth,” said IJ Capital Director Scott Lai.

“We recognised value-add opportunities with Benowa Gardens, consistent with the “core-plus” investment objectives of the Fund.”

Scott Lai, IJ Capital Director

We immediately undertook an active management strategy including centre upgrade works and a focused leasing plan successfully addressing numerous vacancies.”

Benowa Gardens Coles
The Coles-anchored Benowa Gardens shopping centre. Image – Savills

50% capital uplift in two years

Savills selling agent Peter Tyson said IJ Capital were successful in stabilising the centre and significantly improving the income stream, before taking the asset to the market in 2021.

Mr Tyson said Benowa Gardens received multiple offers, before striking a deal with a private investor group that reflected a capital uplift of 50% in under two years.

The sales marks the most recent in a strong spate of retail transactions in Queensland, fueled by the stability of smaller malls providing essential needs.

“Convenience based neighbourhood centres as an asset class remain incredibly popular in the market, attracting a wide range of capital sources. Income streams underwritten by staple everyday needs, predominately food and services, have proven resilience and are less prone to fluctuation from outside influences,” explained Mr Tyson.

“The pandemic effects, social distancing restrictions and work from home, have bolstered performance in the smaller malls.”

Peter Tyson, Savills selling agent

“This underlying performance continues to drive an enormous weight of domestic and off-shore capital, both private and institutional, to target the asset class.

“Transactions on smaller malls tend to be dominated by the nimble private investor fraternity and is likely to remain the case as yields continue to compress in response to the weight of capital,” concluded Mr Tyson.

 

 

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