Investors go shopping for $300m Bankstown Central stake

The availability of a 50 per cent stake in Bankstown Central shopping centre is timely, with the property set for a major overhaul in coming years.

An artist impressions of the $1.3bn Bankstown Central redevelopment

Developers and major institutions are vying for a half stake in Bankstown Central in Sydney’s southwestern suburbs, which is tipped to sell for about $300m as the property is being prepared to be overhauled into a mixed town centre in coming years.

The interest in the centre is being offered via CBRE on behalf of Middle Eastern fund, the Abu Dhabi Investment Council and Challenger Life Company.

The complex is co-owned and managed by listed heavyweight Vicinity Centres, which has proposed an ambitious multistage scheme to transform the area.

It held the whole centre at $541m at the end of last year but plans for 1300 apartments on the site were fast-tracked this year, potentially boosting its value.

Vicinity and Elanor Investors, which handles the funds management for the offshore group, declined to comment on the sale, as did CBRE’s Simon Rooney.

The interest in Bankstown Central is being chased partly as it is a major three-level regional shopping centre in Sydney, where such interests rarely come up.

The centre is anchored by Myer, Big W, Kmart, Coles and Woolworths and has more than 190 specialty stores. It also houses a Grand Market fresh food precinct, a Foot Locker store, Uniqlo, JB Hi-Fi and Services Australia.

The asset’s position in the Bankstown CBD, which is part of the Sydenham to Bankstown Urban Renewal Corridor is the real drawcard. Vicinity five years ago unveiled plans to transform Bankstown Central into a vibrant mixed-use urban neighbourhood.

The 11.4ha site would be a mix of offices, a hotel, serviced apartments, student accommodation, apartments and childcare facilities. An initial stage, including Bankstown Exchange – to feature 30,000sq m of A-grade office space across three buildings and ground-floor retail incorporating a dining-focused ‘Eat Street’ – was approved in 2021.

The full vision would involve 300,000sq m of new buildings being added to Bankstown Central’s existing footprint across 16 development sites, staged to meet demand.

While high costs have crimped some projects, big shopping centre owners are moving ahead with residential projects on their sites. Notably, Scentre is planning a scheme at Westfield Warringah on Sydney’s northern beaches and has received rezoning approvals at Westfield Hornsby in Sydney and Westfield Belconnen in Canberra.

The Abu Dhabi Investment Council and Challenger Life Co bought their stake in the mall as part of a deal in 2013 when they bought both the Bankstown interest and a half stake in a Roselands complex from Vicinity forerunner Federation Centres.

Vicinity last year sold a 50 per cent interest in the Roselands centre to a fund managed by HMC Capital for $167m. It also sold its interest in another Sydney centre, Carlingford Court.

Originally published as Investors go shopping for $300m Bankstown Central stake