Weekly Update 15/11/2021

Welcome to this week’s Property News.

Major Retail Shopping Centre sales featured heavily again this week as some major landlords continue to sell down their exposure in the troubled sector. Hong Kong listed Link REIT spent $538m to acquire the Sydney CBD Retail Assets from Ipoh Property and Fawkner Property Group spent $146m to acquire Stockland Cairns.

These assets have been badly affected by the impacts from COVID restrictions on travel, but are irreplaceable assets that need time to recover. Link REIT & Fawkner now have the time to allow these Centres to recover. The Link REIT deal reflects a 5.5% yield and the Fawkner deal a 6.75% yield.

Greenpool Capital and Qualitas also completed their investment in Runaway Bay this week, paying another $132m for the remaining 50% of the centre held by Vicinity, reflecting a 6.25% yield.

The limited pool of fresh enthusiasm for the sector has attracted AMP Capital to put up for sale a 50% interest in the Stockland Townsville Shopping Centre who hopes be attract some interest before other assets hit the market.

Stockland’s new Strategy announced this week will see them pivot further away from retail and more into Workplace, Logistics and Residential, ditching the decade old mantra or the 3 R’s. With this pivot will come about $1.6bn of additional retail shopping centre “for sale” adds and $1.0bn of retirement village “for sale’ adds, with at least half of these to take place over by the end of 2022.

COVID restrictions and the trend toward online retail continues to hurt the sector. This week, Vicinity & SCentre both revealed the impacts from COVID restrictions last quarter with customer visitations, sales and rental collections heavily impacted, particularly in NSW and Victoria. The expectations of a bumper Christmas remain, provided staff and stock are both readily available.

Have you got your Christmas Buying List ready ?

If you have any news, information or research reports you’d like us to share with the market, please feel free to send me an email at info@propertymarkets.news or simply submit an article for us to review here.

Until next week


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About Warwick Petschack

Warwick has over 25 years of property investment and management experience. Principally responsible as Managing Director for Capital Management Australia and Joint Managing Director for Chauvel Capital Partners and Editor of Australian Property Markets News.

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