The GPT Wholesale Shopping Centre Fund is moving to sell a 50% interest in Northland Shopping Centre, a dominant regional shopping hub in Melbourne’s northern suburbs.
Colliers and CBRE have been jointly appointed to manage the sale of the centre stake, which is strategically positioned in Preston, 13km from the Melbourne CBD, and serves a substantial trade area in excess of 520,000 residents.
Occupying a prominent 19.04-hectare site, Northland Shopping Centre presents significant development potential with a masterplan for a 30-year staged development. The centre features a substantial Gross Leasable Area (GLA) of approximately 98,000 square metres anchored by leading national retailers including Myer, Target, Kmart, Coles, Woolworths, Aldi and Hoyts Cinemas.
The prominent tenant mix boasts an attractive major tenant weighted average lease expiry (WALE) of nearly 7.5 years by income.
Colliers managing director for Asia Pacific – retail capital markets, Lachlan MacGillivray said, “Recent market conditions have seen a resurgence of liquidity, driven by $3.1 billion in key scalable transactions over the past year. This favourable environment makes the introduction of Northland Shopping Centre particularly timely, presenting a unique opportunity for investors.
“The last transacted stake in a super regional asset in Victoria was Pacific Werribee in 2018 at a reported cap rate of 4%, highlighting the extreme rarity of this offering.”
CBRE head of retail capital markets Pacific, Simon Rooney added, “The value proposition for regional shopping centres has become increasingly compelling for investors, given the superior comparative returns on offer, rebased sustainable income profiles and robust performance fundamentals, as compared to most alternative commercial property asset classes.
“The renewed investor interest in the sector is supported by robust long-term fundamentals, including limited new supply, ongoing population, jobs and wage growth, and low vacancy rates, all of which are providing strong tailwinds for the retail sector.”
Northland Shopping Centre includes the only department store in Melbourne’s northern suburbs and is unique within a 7km radius for its triple supermarket and double discount department store offerings. The centre’s mini-major and specialty tenants include Mecca, Uniqlo, H&M, Seed and Kookai, which are not represented within a 10km radius.
The centre is co-owned and managed by Vicinity Centres with approximately 60% of its income subject to annual reviews of 3% to 5% and a strong representation of national and chain retailers.
The opportunity to acquire a 50% interest in Northland Shopping Centre is available through Expressions of Interest (EOI), closing in late October.