Shopping centres reset as Haben makes $115m Townsville swoop

Property funds group Haben has made its next big move in the rapidly shifting shopping centre market, snapping up a half stake in Stockland Townsville for $115m.

Haben has bought a 50 per cent stake in Stockland Townsville.

Property funds group Haben has made its next big move in the rapidly shifting shopping centre market, snapping up a half stake in Stockland Townsville in northern Queensland for $115m.

The deal shows the appetite for top shopping centres is returning but that prices have dramatically come off in the wake of the Covid pandemic and interest rate hikes.

The mall is co-owned and managed by Stockland and sold at an 11.5 per cent discount to that group’s $130m book value in June.

Large shopping centre sales have been slow but there are now signs of recovery as retailers have performed well despite the tougher economic climate and they are striking new leases.

Major institutions are still selling down their retail holdings, partly to meet investor redemptions, and smaller groups are swooping on the centres that are available.

Dexus sold the 50 per cent interest in Stockland Townsville out of the AMP Capital Shopping Centre Fund, which it took on as part of its purchase of the local Collimate Capital business last year.

The sale was the first regional shopping centre trade since last November as rate hikes have held back deal-making. JLL’s Nick Willis and Sam Hatcher handled the sale, which drew strong investor interest due to the relatively low price point for a stake in a dominant regional shopping centre.

Haben is diving hard into the big reset in shopping centres and is also targeting the purchase of the Cairns Central complex in Far North Queensland from a Lendlease-run fund for close to $400m. Earlier this year Haben also bought the Forest Hill Chase shopping centre in Melbourne’s eastern suburbs from US group Blackstone.

Haben bought Forest Hill Chase shopping centre earlier this year.

The Townsville centre is a 45,021sq m property that underwent a major $180m redevelopment and expansion in 2012. AMP then picked up its half stake in 2014 for $228.7m. That included a half interest in a separate Coles and Kmart which was sold last year to a syndicate for $47.25m.

Mr Willis said the latest deal showed the liquidity for the regional subsector as well the new capital emerging for institutional-grade retail assets.

“In the last three years we have seen 16 partial interests trades, totalling more than $3.75bn of capital, of which 60 per cent was maiden,” he said.

Buyers are a mix of super funds, syndicators and private investors, like Nikos Property, which bought 50 per cent of Colonnades Shopping Centre in South Australia, in its first shopping centre investment.

Super funds Cbus and Aware Real Estate have also entered the area with Cbus picking up interests in both Sydney’s Macquarie Centre and Pacific Fair on the Gold Coast, alongside UniSuper. Aware took a half stake in Sunshine Marketplace in Melbourne.

“Globally we are seeing capital re-emerge for retail assets, due to the growing evidence of assets’ forecast performance, relative value and underlying land and multifaceted nature, compared to other sectors,” Mr Willis said.

The deal came against the grain of shopping centres sales where transactions halved in the first half compared to the same time last year.

Mr Hatcher said Stockland Townsville was benefiting from the economic performance of the wider region, and rent levels on new leases were rising. He said purchasers were also after the site’s future development potential.

Haben managing director Ben Finger said the purchase was “on strategy” and would provide stable and higher returns for investors in the higher interest rate environment.

“We continue to see our centres trade with exceptionally strong sales growth, low vacancy, and positive rental spreads,” he said.