ASX-listed retail giant Scentre Group has acquired a 50 per cent stake in Westfield Eastgardens in Sydney’s south-eastern suburbs for $720 million.

The centre was wholly-owned by the John Saunders-founded Terrace Tower Group, which sold the Westfield Eastgardens centre on a 4.25 per cent yield – representing one of the country’s largest ever single-asset retail deals.

The sale follows AMP’s acquisition of a 50 per cent share in Brisbane’s Indooroopilly shopping centre for $800 million last year.

The late John Saunders co-founded Westfield with Frank Lowy. The family-owned Terrace Tower Group also owns the Supa Centre Moore Park.

The major regional Westfield Eastgardens centre offers about 85,000sq m of total lettable area – making it one of the top 30 shopping centres in Australia – with total retail sales of more than $600 million.

Scentre chief executive Peter Allen said that the centre is regarded as one of Sydney’s “strategic centres” with a trade area that has strong population growth and infrastructure investment.

“In line with the Group’s strategy, this transaction is a rare opportunity to invest in one of the highest quality ‘living centres’ in Australia,” Allen said.

JLL’s Simon Rooney brokered the deal on behalf of Terrace Tower Group.

“Investors were attracted to the future mixed-use/residential opportunities of the site and the imminent retail redevelopment potential to enhance medium and long-term returns,” Rooney said.

“Investor sentiment is very positive towards core retail assets such as major regional shopping centres. Owners are repositioning their portfolios towards defensive and high quality retail assets, which will continue to attract leading retailers and capture a growing share of consumer spend."

In an ASX statement, Scentre Group touched on the centre’s redevelopment potential including the opportunity to “create value through mixed-use development including commercial, accommodation and education facilities.”

Originally built in 1987, Westfield Eastgardens is anchored by a Myer department store, three supermarkets – Woolworths, Coles and Aldi – a Kmart, Big W and Target among 230 specialty shops and retailers.

The centre underwent refurbishment in 2002 and 2013.