- EQ acquired the 50% stake from US investment manager Invesco
- Vicinity Centres owns the remaining stake
- Comes after over $3.4b in Queensland retail assets changed hands last year
The resurging interest in sub-regional shopping centres continues, with EG announcing it has acquired a half stake in Brisbane’s Grand Plaza Shopping Centre for its Australian Core Enhanced Fund.
Simon Rooney, CBRE’s head of Retail Capital Markets – Pacific, negotiated the transaction on behalf of Invesco, a US investment manager.
The transaction value has not been disclosed publicly by any party.
Vicinity Centres owns the remaining 50% stake in the Browns Plains centre, which is 22 kilometres south of Brisbane’s CBD.
Mr Rooney noted that the sale further highlights rising demand for such shopping centres, especially across the Queensland market.
“There has been a surge in capital flows into the sub-regional sector, fueled by a rebasing in values and rents and the attractive yields on offer compared to other asset classes,” Mr Rooney said.
“The Grand Plaza transaction also highlights continued strong demand for Queensland retail investments, with over $4.5 billion in sales occurring since the beginning of 2021.”
The core capitalisation rate is close to 5.25%. with the asset having a gross lettable area of 53,288sqm.
94% of the total lettable area is represented by a range of major, national and chain retailers, who also make up 92% of the gross passing income.
Retailers include the triple-supermarkets – Coles, Woolworths and Aldi – along with Big W, Target, Kmart and Events Cinemas. The food court ahs also been recently refurbished.
Additionally, the centre has an underutilised site area of 181,090sqm and off-grade car parking.
“Value can be extracted from this asset with an active asset management strategy to enhance the retail offering and tenant mix,” added EG’s Head of Capital Transactions, Sean Fleming.
“Based on the data EG has interrogated, Grand Plaza mall is expected to benefit from the anticipated capital growth and cap rate compression across Australian retail markets in 2022.”
Major shopping centre deals announced recently included Brisbane’s Straphine Centre, acquired by family-owned YFG for $267 million from US private equity firm Blackstone late last year. The transaction was also negotiated by Mr Rooney.
This transaction came as $3.7 billion in retail assets changed hands throughout the state during 2021.
Fernvale Village shopping centre also recently sold for $35.55 million after receiving 14 offers.
