Dexus Doubles Down on Warringah Mall Stake with $410m Spend

Dexus is doubling down on its investment in Westfield’s Warringah Mall in Sydney as the top end of Australia’s retail property market makes a speedy recovery in the lead-up to Christmas with the nation’s vaccination levels and consumer confidence on the rise.

The exchange of contracts by Dexus Wholesale Property Fund (DWPF) to acquire an additional 25 per cent interest in the regional centre comes as Covid restrictions lift and the reopening of borders looms.

Its circa-$410-million investment brings its stake in the 131,589sq m asset at Brookvale in Sydney’s northern beaches to 50 per cent, with Scentre Group retaining ownership of the other half-interest.

The transaction—the latest in a number of major shopping centre deals—is due to settle next month and pushes its vale to more than $1.6 billion.

“This acquisition increases DWPF’s interest in a well-performing super regional retail asset which is expected to benefit from embedded development opportunities,” DWPF fund manager Michael Sheffield said.

“The acquisition represents relative value compared to other asset classes in a post pandemic environment.”

Anchored by Myer, David Jones, Big W and Kmart stores, along with Woolworths and Coles supermarkets, Hoyts Cinema and Bunnings, the three-level shopping centre has undergone numerous additions and refurbishments.

It underwent a $310-million redevelopment in 2015 and a masterplan for the centre, which opened its doors in 1963, provides for mixed-use redevelopment and repositioning opportunities over the long-term.

A rush of major shopping centre deals has gained momentum in recent times after months of the sector being laid low by the pandemic.

A consortium including UniSuper, Cbus Property and the AMP Capital Finance shattered the record for Australia’s largest retail transaction, picking up a 50 per cent stake of the Macquarie Centre in Sydney’s north and 80 per cent of Pacific Fair on the Gold Coast in a $2.2-billion deal.

Brisbane-based fund manager Sentinel Property Group pounced on Darwin’s Casuarina Square shopping centre for about $420 million, acquiring it from GPT Group, in one of the city’s biggest retail deals.

Haben Property Group and Hong Kong-based investment house JY Group acquired Wollongong Central shopping centre from GPT Group in a $402 million deal.

JY Group also has secured a half stake in one of Australia’s oldest suburban shopping centres, Roselands in Sydney’s south-west, from Challenger in a $167 million deal.

As well, Fawkner Property snapped up Cairns Shopping Centre, the largest retail centre in far north Queensland, for $146 million.