Weekly Transaction Update – 5th April

5 April 2019

This week we recorded 26 major transactions worth $541m Charter Hall buy $142m Rockdale Plaza The Charter Hall Retail REIT has acquired Rockdale Plaza in Sydney from City Freeholds in a $142 million deal. The centre has a total GLA of approximately 21,331m2, high occupancy of 99.8% and is anchored by a strong performing Woolworths and ALDI supermarkets, a Big W together with seven mini-majors and 46 specialties plus convenient parking for 907 vehicles, driving 4.5 million annual customer visitation (+3.0% year on year) According to SCN, Rockdale Plaza has an annual turnover of $180.8 million (+5.0% year on year) with strong speciality turnover of $11,703 per sqm (+4.9% year on year). Rockdale Plaza’s outperformance is underpinned by a substantial worker population and a vast main trade area of 130,040 residents, growing at a robust 1.9% p.a. over the next decade. The Centre sits beneath 3 residential towers in what was one of Sydney’s first mixed use developments. The sale was brokered by JLL and achieving a cap rate of 6.25%. Charter Hall’s Retail CEO, Greg Chubb said, “The acquisition of Rockdale Plaza offers the REIT an exceptional opportunity to acquire a high performing, convenience-based centre. Underpinned by supermarkets and non-discretionary food and service-based uses, the Acquisition aligns with the REIT’s investment strategy and enhances portfolio metrics to ensure we continue to deliver long-term sustainable growth in earnings for investors”. Charter Hall have been disciplined in their acquisitions over the past 1-2 years with their only other recent acquisition being Gateway Plaza, Leopold VIC which they purchased in June 2018 for $117M. Melbourne Welcomes Meriton Meriton has acquired 140 King Street near Southern Cross Station where he will develop a Meriton Suites apartment hotel to expand his offering across the east coast. The site was previously owned by Sydney-based Besgate Group who abandoned plans to develop three properties amid a weakening Melbourne apartment market. According to the SMH Besgate paid $10m for the site in 2016. A planning permit for the site was issued by the State Government in October 2016 despite opposition from the City of Melbourne. The approved development scheme comprised a 59 level tower with 25,910sqm of GFA containing 271 dwellings. The site was offered for sale in mid 2018 by Colliers and CBRE. According to the AFR Meriton are paying $29M for the site, equating to 107,000 per approved apartment. Polly Acquires first Brisbane site Poly Australia has secured its first development site in Brisbane, acquiring a slice of land alongside the Doomben racecourse for $35.25 million. The 6.2-hectare site is on the corner of Lamington and Mordant Streets. The site is zoned ‘Emerging Community’ under Brisbane City Plan 2014 allowing development including townhouses and apartments. A Development Approval is in place for subdivision of site. The site adjoins a two hectare parcel of surplus land alongside Doomben racecourse on which LendLease are developing 300 independent living units and 108 full service high-care aged beds. The related Eagle Farm racecourse, (700m west) also commenced the first stage of development with Mirvac in 2016, delivering 219 luxury apartments units in two residential towers overlooking the racecourse, with one tower spanning 13 storeys and the other 10 storeys. According to the Dec 2018 Update from Mirvac, the project had sold 96 out of 174 apartments in the first 2 stages with capacity for 793 additional apartments in future stages. The Lamington site was marked by JLL. Review our other transaction data at ReSourceData. * indicates unconfirmed price or apportionment of a portfolio sale #ReDataSource