Three-State Retail Portfolio Sells for $180m

A portfolio of five neighbourhood shopping centres across three states has been snapped up by publicly traded SCA Property Group for $180 million.

SCA, which owns and manages convenience retail assets across Australia, beat out 20 other offers for the portfolio of shopping centres in regional Queensland, Adelaide and Perth.

JLL, which sold the centres on behalf of Centuria Capital Group’s subsidiary, Primewest, said the geographically diversified portfolio offered immediate scale in the highly fragmented convenience retail sector, as well as a secure income stream, with nearly 90 per cent of income underpinned by non-discretionary uses.

“The assets were strongly sought on a portfolio and individual basis with 21 offers received, reinforcing the pent-up demand from varying capital types to own neighbourhood centres,” JLL’s joint head of retail investments in Australia, Sam Hatcher, said.

“Neighbourhood centre investment activity in 2022 continues to be strong, with 22 assets trading within the first half of the year, totalling $900 million,” Hatcher said.

The portfolio is made up of Brassall Shopping Centre, north of Ipswich; Port Village in Porth Douglas; Dernancourt Shopping Centre and Fairview Green, both in Adelaide; and Tyne Square in Beaufort Street, Perth.  They sold for between $12 million and $46.5 million each.

Australia’s retail sector remains buoyant after shrugging off the sluggish sales of the pandemic to record $12.7 billion in asset transactions last year.

Hatcher said the non-discretionary retail sector was proving to be the most resilient across all sectors.

“With construction costs at elevated levels for the foreseeable future, existing and strongly performing neighbourhood centres will continue to attract a premium with constrained supply,” he said.