Shopping centres back on the shelf
Sydney Morning Herald
Saturday February 20, 2010
THE resurgence in the retail sector, albeit slow, has led to a rise in the number of sales for small-to-medium shopping centres.A further indication the sector is turning around is the decision by Stockland to reactivate its retail development pipeline.The group reported in its interim results that it had five new projects expected to start in the next few months. The cost to complete these projects will be $548 million and, combined with the $275 million committed to projects under construction, it took its committed retail development expenditure to $823 million.Real estate group Savills reported shopping centres in the $10 million to $50 million price range were forecast to dominate retail property transactions.Savills recently concluded the sale of its latest neighbourhood shopping centre and highlighted the improving investor demand for quality retail properties.Peter and Jon Tyson of Savills negotiated the sale of the Riverfront Plaza Shopping Centre at Kempsey on the mid-North Coast of NSW for $12,448,000.The one-year-old centre was bought by Gowing Bros from GEO Property Group."The retail investment market has evolved since early-to-mid 2009, with a number of neighbourhood-centre-size transactions occurring around the country, particularly during the second half of last year," Jon said."This trend has continued into 2010 and the market for shopping centres under $30 million is expected to continue to improve throughout the year."Jon said demand for larger retail centres was also forecast to improve as institutional investors re-entered the market and geared up for counter-cyclical opportunities.According to Savills' national retail research, almost half of all shopping-centre transactions in the year to June 30 occurred in the $10 million to $50 million price range.Savills recorded $1.2 billion worth of shopping-centre transactions during this period, down from $2.4 billion in the previous year and down on the five-year average of $2.6 billion.Recent transactions in NSW include the $57.3 million sale of Port Central Shopping Centre in Port Macquarie and a Bunnings-anchored outlet at Rockdale for $25.3 million.Carolyn Cummins
© 2010 Sydney Morning Herald
