2023 off to a strong start as Major Regional Shopping Centre hits the market

1 February 2023

A 50% interest in a dominant Major Regional Shopping Centre has been put up for sale. JLL’s Nick Willis and Sam Hatcher have been exclusively appointed on behalf of an AMP Capital managed fund to sell its stake in Stockland Townsville shopping centre, via an International Expressions-of-Interest campaign.

The offering comes as investment in Queensland reach new highs. According to JLL Research, Queensland retail transactions accounted for over 40% of total sales volumes in 2022 with investors gravitating towards the sunshine state.

JLL’s Nick Willis said “The offering comes as investment into regional centres reaches record low levels off the back of a resurgence in activity in the latter end of 2021. However, investment volumes in 2021 were primarily driven by pent up demand in the prior year.

“Regional transaction volumes have averaged AUD 1.2 billion annually over the past 10 years. In 2022 only one regional centre transacted for AUD 280 million reflective of the tightly held nature of these dominant assets” said Mr Willis.

JLL Research anticipates Queensland’s economic growth to outperform other states over the next five years as cyclical and secular trends across sectors combine in favour of the sunshine state. Mining, on the back of higher commodity prices, will drive cyclical trends while population growth from interstate and overseas migration should contribute to secular trends.

Featuring the only department store in a 345km radius, Stockland Townsville has a lettable area of some 45,000 square metres is anchored by Myer, Big W and Woolworths, 7 mini-majors, and 149 specialties and kiosks. The property recently underwent a repurposing of the former H&M into three new mini-major tenancies, introducing JD Sports and Cotton On.

Stockland Townsville presents in exceptionally quality, originally opening in 1970 and undergoing a substantial $180 million refurbishment in 2012. The property features an additional 2.6 ha of development land over two adjoining lots, offering investors an array of future development and value add opportunities.

JLL’s Nick Willis said “Stockland Townsville has continued to go from strength to strength and provides investors an opportunity to enter the Major Regional retail sub-sector at a relatively affordable price point without compromising on performance. The asset’s recent leasing activity has seen over 70-new leasing deals & renewals completed since January 2021, taking the occupancy of the shopping centre to an exceptionally strong 99.5%”.

Located within the epicenter of Townsville, just 5km from the Airport, Stockland Townsville has a robust tenant profile with all major tenants expiring post 2031 and specialty tenants with a low occupancy cost of 14.2%. The asset benefits from its strategic main road position allowing high accessibility & exposure to passing trade, whilst further benefiting from the situation within an affluent corridor of Townsville where incomes are 7% above the non-metro Queensland average.

JLL’s Sam Hatcher said “Townsville has continued to evolve and gentrify over recent years, with the fundamentals of the region increasingly strengthening. Unemployment is at a recent all-time low of just 3.0%, down from 8.0% in December 2019. Further, the total gross regional product of the region ($13.0bn) now surpasses that of other major capital cities of Hobart ($8.3bn) and Darwin ($9.6bn). This economic positivity is driving increased consumer spending into assets such as Stockland Townsville, supporting the investment underwrite for the opportunity.”

International Expressions-of-Interest for Stockland Townsville at 310 Ross River Road, Aitkenvale QLD 4814 close on Wednesday 1 March 2023.