Sydney shopping centres are holding their own against the tide of falling values and sluggish trading conditions with activist funds manager Fortius buying Cammeray Square from property trust Stockland for $39.05m.
The Cammeray Square lifestyle and convenience centre on Sydney’s lower North Shore traded on a yield of 7 per cent and is set on a 6,815sq m corner site.
The complex forms part of a mixed-use development comprising four buildings surrounding a central plaza, with retail tenancies on the ground floor, anchored by Harris Farm Markets and comprising 15 specialty shops and restaurants.
The upper levels are occupied by five commercial tenants, including childcare operator, Only About Children, and a strong medical offering. The fully leased site has a weighted average lease expiry of 5.8 years by area.
Cushman & Wakefield’s Nick Potter and Billy Dent managed the sale and the firm’s latest retail investments report found neighbourhood centres were the most heavily traded in the sub-sector in the last quarter.
The report said there had been 14 deals equating to $565m in assets that sold in the quarter on an average initial yield of 6.58 per cent. The Cammeray Square deals followed a number of other Sydney neighbourhood centre sales, including Abacus Property Group’s Liverpool Plaza shopping centre selling to a private development group for $46m and the off-the plan purchase of the Coles Crows Nest stratum in for $43m.
Fortius Funds Management chief executive Sam Sproats said the acquisition was consistent with the firm’s investment strategy of acquiring well-located inner urban retail and mixed-use assets.
Mr Potter said neighbourhood shopping centres like Cammeray Square with a strong weighting towards defensive, convenience and serviced based occupiers, were still experiencing strong demand despite a softer retail environment.
“We continue to see the trend towards neighbourhood centres integrating with strata mixed-use developments,” he said.
BEN WILMOT
COMMERCIAL PROPERTY REPORTER
