Property giant Charter Hall in talks for three more major shopping centres
The country’s largest commercial property player Charter Hall has set its sights on a $250m shopping centre acquisition spree spanning two states.
Charter Hall is locking in its status as the top buyer of convenience retail assets this year and is close to buying another $250m worth of centres across Queensland and NSW after last week making purchases worth about $360m.
The property investment company is in talks to buy a trio of centres from listed rival Vicinity Centres, which has been selling off smaller assets as it puts capital into larger malls and redevelopments.
The move shows Charter Hall’s capacity to expand in the hot convenience sector, which is expected to perform even as some discretionary retail categories are tipped to come under pressure if the Reserve Bank tightens settings.
The company, led by David Harrison, has emerged as a consolidator in the sector where many properties are still held privately.
The company has been buying for its unlisted Charter Hall Convenience Retail Fund, which has attracted about $2.5bn of institutional backing and is targeting a $3bn-plus portfolio.
The three centres it is targeting are split between two in Queensland and one in NSW, and are handled off-market via CBRE’s Simon Rooney. He and the firms declined to comment.
Part of the Queensland deal is a single-level subregional shopping centre anchored by Big W and Woolworths in Gympie Central, about 80km northwest of Maroochydore on the Sunshine Coast.
The 14,154sq m complex had a moving annual turnover of $161.2m.
Whitsundays Plaza, a single-level subregional shopping centre anchored by Big W, Harvey Norman and Woolworths, about 6km southwest of Airlie Beach, is also part of the portfolio. That 22,314sq m centre has 1148 car spaces and a moving annual turnover of $166.8m.
In NSW, Armidale Central, a two-level subregional shopping centre anchored by Kmart and Woolworths, rounds out the portfolio. The 14,512sq m centre is New England’s premier shopping destination and has 610 car spaces and moving annual turnover of $120.9m.
Charter Hall has been among the largest buyers of the cycle.
It tied up its purchase of the Burwood One Shopping Centre in Melbourne last week for $210m. It acquired the complex, a dominant retail landmark in Burwood East, from a private Hong Kong-based investor.
The centre is on a prominent 58,800sq m corner site at the intersection of the Burwood Highway and Blackburn Road.
It is fully leased and anchored by Coles, Kmart and ALDI, along with seven mini majors, 40 specialty stores and eight kiosks.
The anchors are among the best-performing Coles and Kmart combinations nationally.
Earlier in the week billionaire John Van Lieshout sold a shopping centre in Queensland’s Southport for $152.5m to Charter Hall for its fund. The sale of Southport Park was also brokered off-market and the company is using its heft as the country’s largest commercial property player to lock down more deals.
Charter Hall is bullish about the capacity of convenience retail assets to hold up and its ability to consolidate in the still-fragmented industry.
It is also counting on its property skills to both expand their retail elements and could consider alternate use in future as it is across all property sectors.
Charter Hall investors have enjoyed a bumper year with the stock surging 71 per cent to $24.51, compared to a 5.8 per cent gain for the S&P/ASX 200.
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Originally published as Property giant Charter Hall in talks for three more major shopping centres
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