Scentre Group has cut the ribbon on the $470 million development at Coomera in Queensland, the property giant’s first greenfield shopping centre project since being spun out of Westfield.
In a break with tradition the centre at the northern end of the Gold Coast will also open without having a department store as the anchor.
It has been 12 years since Westfield opened its North Lakes mall, which was before the creation of Scentre Group. The next big project for the landlord will be the shopping centre at Barangaroo Central in Sydney.
Using the town centre model, in an attempt to increase dwell time for visitors, the 59,000 square metre site will offer up to 40 per cent of space devoted to entertainment and leisure with and Event Cinemas with Gold Class.The major tenant brands will include H&M and Mecca Cosmetica and also a Universal movie store as well 40 specialty retail stores, including Coles, Woolworths, Kmart, Target, JB Hi-Fi, Rebel.
One of the key aspects of the new shopping centre is The Backyard, which is an area that offers a play area for children to hold birthday parties, a gym zone, BBQ areas and water features.
Westfield Coomera sits opposite the Dreamworld theme park and the nearby Movie World, to capture the tourist dollars.
Scentre’s chief executive Peter Allen said the group used the ”blank canvas” of a greenfield project to create a shopping centre of the future.
Scentre Group has opened its new $470 million Coomera shopping centre, Gold Coast, Queensland
”Coomera centre is the first mall we have created from the ground up and using data collected we can curate it for the area, which is a growth corridor” Mr Allen said.
Mr Allen said the research undertaken by Scentre has shown that customers want more leisure and entertainment with specific specialty areas, such as a holey moley golf putt putt bar and restaurant.
”We will have key retailers that offer the same individual products that are offered in a traditional department store,” he said.
Mr Allen said the ongoing parliamentary inquiry into the franchise industry had had no direct impact on the Scentre Group.
He said, as a landlord, Scentre always encouraged strong and healthy relationships between franchisors and franchisees.
AA Reit to buy Gold Coast industrial property for A$38.5m
SINGAPORE – AIMS Apac Reit (AA Reit) is expanding its footprint in Australia with a A$38.46 million (S$36.92 million) acquisition of a freehold industrial facility in Gold Coast, its manager announced on Wednesday morning (May 15) before the market opened.
In a press statement, its manager noted that AA Reit has entered into a sales and purchase contract with GSM Rocket Australia to purchase Boardriders Apac HQ, located in the suburb of Burleigh Heads, Queensland.
The deal amount was arrived after considering an independent valuation by CBRE Valuations Pty Ltd, which valued the property at A$38.46 million.
After including stamp duty payable and other transaction costs, the total estimated cost of the acquisition is about A$41.5 million. This is expected to be funded mainly from Australian dollar debt facilities in order to maintain a natural currency hedge on the acquisition, the Reit manager said.
Assuming that the transaction will be fully funded by debt, AA Reit’s aggregate leverage post-acquisition will increase to 35.5 per cent on a proforma basis, up from 33.7 per cent as at March 31, 2019.
The property will be leased to GSM Operations Pty Ltd for 12 years on a triple net lease basis, which is a lease structure where the master tenant is responsible for outgoings of the property, including repair and maintenance costs, insurance, and taxes, among other things.
Both the vendor, GSM Rocket Australia, and the tenant, GSM Operations Pty Ltd, are subsidiaries of Boardriders Inc, a global actions sports and lifestyle firm that designs and distributes brands including Quiksilver, Billabong and Roxy.
The first year rental from the property is A$3 million, and will increase by 3 per cent per annum, with a rent review at mid-term of the lease, the manager said. Under the contract, the tenant also has an option to renew the lease for another five years.
The development, which sits on a land area of 33,300 square metres (sq m), with a total net lettable area of 14,833 sq m, comprises a warehouse and office facility, as well as a two-storey retail building.
Notable properties in the vicinity include Stockland Burleigh Heads Shopping Centre, and the upcoming Kaufland giant supermarket. The property is also situated about 3 kilometres from Burleigh Heads Beach, and a less than 20-minute drive from Gold Coast Airport.
Koh Wee Lih, chief executive of the Reit manager said: “The proposed acquisition represents an opportunity to further diversify and strengthen our portfolio with a strategic addition that offers a strong tenant profile, and provides income stability to AA Reit. In line with our strategy to build a high-quality, diversified portfolio of assets that creates long-term value for our unitholders, the acquisition will be DPU accretive.
“The outlook for the Gold Coast economy remains positive, as the region is currently experiencing growth across key economic factors including strong population growth, investment into major infrastructure developments and an increase in both domestic and offshore tourism into the region. This investment will enable us to expand AA Reit’s footprint in a market that offers solid long-term growth,” added Mr Koh.
Upon completion of the acquisition, AA Reit will own a total of 27 industrial properties, of which 25 are located throughout Singapore, with one located in Gold Coast, Australia, and a 49 per cent interest in a property located in Macquarie Park, New South Wales, Australia.
As at 10.51am on Wednesday, units in AA Reit were trading at $1.39, up 0.7 per cent, or one cent, after the announcement.
Dexus Eyes $100m Sale for Brisbane Retail Centre
Dexus Wholesale Property Fund are looking to offload a 100 per cent freehold interest in Beenleigh Marketplace, a sub-regional shopping centre located 32-kilometres from Brisbane’s CBD.
The 19,476 square metre asset, which last transacted in 2013, is anchored by Woolworths and Big W and spans a 60,680sq m site.
The landholding also includes 4,390sq m of adjoining land earmarked for further development.
JLL head of retail investments Simon Rooney has been appointed to market the expressions of interest campaign amid weak sentiment in the retail property sector.
“Investors are pursuing a low-risk retail strategy at present,” he said.
Rooney said investors were targeting small and mid-sized sub-regional centres with a major focus on retail services along with food and beverage offerings.
“F&B has consistently been the fastest growing retail category over the last five, 10 and 20 years, which underpins solid leasing demand.”
Recent transactions for sub-regional centres include the Rockdale Plaza sale in Sydney purchased by Charter Hall for $142 million last month, Sydney’s Neeta City purchased by Elanor Investors for $85.3 million in March, and Melbourne’s Campbellfield Plaza bought by Charter Hall for $74 million in December last year.
Transaction activity was highest within the $50-million to $150-million bracket for retail property last year.
Rooney said the Beenleigh retail hub outperforms the industry averages with total centre moving annual turnover (MAT) of $113.7 million.
Beenleigh, located in the city of Logan, has a current population of 83,570 which is expected to increase 2.1 per cent annually to 2031.
The expressions of interest campaign closes on June 6.
Tenant Demand in Gold Coast Office Market Expected to Rise
Investment activity in the Gold Coast office market was subdued in 2018 with few assets on offer, although Knight Frank expects the tide to change this year with around $90 million in assets hitting the market in 2019’s first quarter.
The office investment market on the Gold Coast, Australia’s sixth largest city, has traditionally been dominated by private investors and syndicators given the relatively smaller investment scale.
But as confidence builds with a higher level of tenant demand and the depth of the market, Knight Frank’s Mark Witheriff says the region is “likely to appear on the radar for a greater swathe of investors”.
Sustained population growth is forecast to average two per cent per annum over the 25 year period from 2016 to 2041, with the majority of growth to come from both internal and overseas migration attracted to lifestyle and educational opportunities, according to Knight Frank’s Gold Coast office market overview.
Local businesses dominate demand
While tenant demand in the Gold Coast office market has been dominated by local businesses, Knight Frank’s Tania Moore said there’s a growing core of larger corporates with branch or head offices located in the region.
“With the likes of National Disability Insurance Agency, Mantra Group (Accor) and Wyndham Vacation Resorts and Asia Pacific,” Moore said.
“With only 37,500sq m of supply added to the Gold Coast market over the past 10 years (9 per cent growth in the stock base) there is a relatively small pool of modern assets which can handle the higher employee densities required for major corporate branch offices, processing centres and call centres.”
The research found supply remains low but pre-committed new construction was beginning such as the recently acquired Acuity Business Park, snapped up by Alceon last month for $7 million from the Gold Coast City Council, which plans to kick off construction.
Knight Frank’s Jennelle Wilson says the supply of new office space across the core Gold Coast precincts stalled during 2018 with only 2,744sq m of refurbished space returning to the market.
“Supply is expected to remain small, sporadic and pre-commitment driven in the medium term.”
Total vacancy for the Gold Coast office market is 11.6 per cent, this after hitting 12 per cent mid last year.
“Despite the vacancy rate on the Gold Coast stalling at double figures, rental growth is well entrenched due to the relatively low number of quality options available, with prime effective rental growth of 5.9 per cent year-on-year recorded,” Wilson said.
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