IGA tyne square
IGA Tyne Square. Image supplied.
  • The portfolio consist of five assets in Queensland South Australia and Western Australia.
  • Entire portfolio valued at $200 million
  • Comes as the Primewest's unlisted funds reach maturity

A neighbourhood retail portfolio consisting of five assets across Queensland, Perth and Adelaide has been listed by Centuria.

The listing comes as demand for convenience-based retail assets remains elevated nationally. However, demand has been met with a significant constraint of investment supply this year.

2021 saw 58 transactions involving neighbourhood centres to the tune of $2.9 billion. For perspective, the sub-sector saw $1.5 billion in 2020, despite the pandemic increasing demand across neighbourhood shopping centres.

“We have seen a shift in investor demand looking to increase weighting to the sector, however, this remains difficult in what is a highly fragmented sector,” noted JLL’s Retail Investments (Australia) Senior Director, Nick Willis.

Mr Willis and colleague Sam Hatcher have been appointed to lead the expression of interest campaign alongside Jacob Swan, Nigel Freshwater and Ben Parkinson for The Australian Neighbourhood Portfolio.

The assets fall under Primewest, a Centuria Capital Subsidiary, who are divesting the shopping centres due to their unlisted funds reaching their maturity.

The assets include Port Village in Port Douglas, Brassal Shopping Centre in Brassal, Primewest Dernancourt, Tyne Square in Perth and Farview Green at Fairview Park. The five centres are valued at $200 million.

“This portfolio provides a very unique opportunity for an investor to gain immediate and diversified scale,” said Mr Willis.

“In addition to the attraction for larger portfolio buyers we also anticipate strong demand on individual asset basis given their unique and attractive propositions.”

Nick Willis, JLL

Mr Hatcher added that transaction activity is being driven by a range of capital sources, noting that investors and syndicators are actively acquiring these assets due to the low cost of debt.

“Yields for the sub-sector have been resilient given the liquidity in the private investor and syndicator market, combined with resilient performance of fundamentals through the COVID-19 crisis in terms of MAT and rent collections,” he said.

“Population growth is a key long-term driver of food retailing which underpins convenience retail assets.

“While border closures weighed on population growth in the short term, Australia is forecast to have one of the strongest rates of population growth among developed countries over the next five years.”

Sam Hatcher, JLL

Although retail spending declined during the peak of the Omicron outbreak in January, retail turnover rose 1.8% in February and appears to be gaining momentum.

The international expressions of interest campaign for the portfolio close on Thursday, 19 May.

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