Bankers including Matthew Ground to check out of Mernda Junction shopping centre

A high-profile group of investment bankers including Matthew Grounds are cashing in on the sale of their Melbourne shopping centre.

Mernda Junction shopping centre opened in 2019. Picture: Ellen Smith

A high-profile group of investment bankers is looking to cash in on a still booming part of the shopping centre industry, with a syndicate including the top echelons of UBS and rival Barrenjoey to sell a retail mall in Melbourne for well over $60m.

The consortium, which includes interests associated with former UBS chief executive and now Barrenjoey co-executive chairman, Matthew Grounds, as well as UBS co-head of global banking roles for Australasia, Kelvin Barry, is selling the Mernda Junction shopping centre, which it developed.

Mr Grounds is not a director of the group, but his wife Kimberley Grounds holds ­equity. Mr Barry, UBS equity capital markets executive Andrew Stevens, along with investment heavyweights Tim Antonie from Stratford Advisory, Quentin Miller from Intrinsic Partners and Peter Scott from Gresham, are also invested.

Smaller centres anchored by supermarkets have jumped in value as they performed strongly during the pandemic and continued to trade well as the economy recovered.

Barrenjoey co-executive chairman Matthew Grounds.

Neighbourhood centres are now viewed as a good hedge against inflation as food prices soar, lifting turnover. There has been a run of sales of centres along the eastern seaboard but few neighbourhood centres have changed hands.

Stonebridge Property Group agents Justin Dowers, Kevin Tong and Carl Molony are handling the offer.

They are marketing Mernda Junction as a trophy Melbourne neighbourhood centre anchored by a dominant Coles supermarket secured by a rare 20-year lease from 2019. The centre is in the rapidly growing northeast corridor of Melbourne.

The investment fundamentals are strong, including a long lease expiry by area of 11.8 years underpinned by 16 years remaining on Coles’ lease, exceptional turnover rent performance and specialty tenant rent reviews of 4-5 per cent per annum.

It is not the first time that the UBS-linked bankers have invested in a retail property development.

Mr Grounds and investors including Mr Barry, along with former colleagues Mr Antonie and Mr Scott, doubled their money when they sold out of the Springhill shopping centre in Cranbourne, in Melbourne’s southeast, for $43.5m in 2017.

In the Mernda play, they picked up the development block in the growth suburb in 2016 for about $8.6m and then landed Coles as an anchor tenant to open the centre in 2019. While the investors had to weather the storm of Covid-19 they now look to set win out.