Revelop goes shopping at Lake Macquarie Square

The private company Revelop is adding to its shopping centre empire as large institutions sell down into the rising market.

Revelop has bought Lake Macquarie Square in regional NSW for $122.5m

Property developer Revelop has swooped on Lake Macquarie Square in a $122.5m deal as it expands its holdings in regional NSW.

The private group has emerged as one of the prime movers in buying and developing shopping centres across the state, backing consumers to keep spending in supermarket-anchored complexes.

Revelop picked up the centre, Mount Hutton near Newcastle, from the listed Charter Hall Retail REIT. In a sign of the strength in the market, the trust said the sale reflected a 1.2 per cent premium on book value.

Charter Hall Retail chief executive Ben Ellis said the sale “forms part of our ongoing curation strategy, which has seen us expand our exposure to net lease convenience retail, further enhancing the income growth potential and quality of our portfolio”.

The sale was handled by JLL’s Nick Willis and Sam Hatcher in an off-market deal.

The Charter Hall fund had completed a $60m redevelopment in 2019 that consolidated Lake Macquarie Fair and Mount Hutton into a single retail ­destination.

It now has a moving annual turnover exceeding $160m. The centre is anchored by Woolworths, Big W and Coles, with about 69 specialty stores, including a dining precinct.

Over the past two years Revelop has added seven retail properties to its growing portfolio. Their most recent deals include Pemulwuy Marketplace, Stockland Balgowlah and Stanhope Village.

It also bought Kirrawee Shopping Centre in Sutherland Shire, which was offloaded by supermarket giant Woolworths for $39.75m, and acquired East Quarter Village in Hurstville in another direct deal for about $30m.

Revelop has also been looking to develop new shopping centres and snapped up a site for a $200m-plus shopping centre on Sydney’s outskirts from Melbourne’s Tarascio family.

Revelop, led by directors Anthony El-Hazouri and Charbel Hazzouri, has been buying shopping centres offloaded by larger institutions and repositioning them.

Mr Hazzouri said the acquisition of Lake Macquarie was a “strategic addition” to the portfolio, connecting and providing great efficiencies for its development of Chisholm Village, which is now under way.

Mr El-Hazouri said that like metropolitan Sydney, the surrounding catchments in Newcastle and Wollongong were very tightly held.

“The ability to acquire a quality subregional like Lake Macquarie from Charter Hall was an opportunity we have been searching for and we are excited to bring the asset into our portfolio,” he said.

JLL’s Mr Willis said the sale underscored the ongoing demand for subregional centres and reflected the increasingly positive sentiment surrounding retail globally. He said few subregional assets were available this year.

“This scarcity has prompted investors to expand their focus to other regional cities, as opportunities to acquire controlling stakes in subregional properties within Sydney’s metropolitan area are seldom available,” he said.

JLL’s Mr Hatcher said that over the past five years there had been a significant shift in the ownership profile of sub-regional centres. “While institutional investors traditionally dominated this sector, syndicators and privates have emerged as increasingly active buyers of these assets,” he said. “This cyclical pattern outlines the dynamic nature of commercial real estate investment and highlights the ongoing competition for quality assets in the sub­regional sector.”