IOOF swoops on Chirnside centre in $50m-plus deal
MaxCap and Troon sell Chirnside Lifestyle Centre to IOOF Investment Services.
Joint venture partners MaxCap Group and Troon Group have sold the newly developed Chirnside Lifestyle Centre in Melbourne to the IOOF-managed AM Property Plus trust for more than $50m.
The trust is part of the Direct Property Portfolio managed by MLC Asset Management, the investment division of Insignia Financial Group.
The 11,100sq m large format retail project, comprising 286 car bays, was fully pre-leased when construction was completed last December. The venture also divested two pad sites directly to McDonald’s and KFC as part of the project.
The centre sale was managed by Colliers’ Tim McIntosh, James Wilson and Mike Crittenden as well as Stonebridge Property Group’s Justin Dowers, Kevin Tong and Phillip Gartland.
The deal on the centre, 32km northeast of the Melbourne CBD in Chirnside Park, was struck at a sharp 5.25 per cent capitalisation rate.
The centre is fully leased with a tenant profile dominated by national brands, including Harris Scarfe, Baby Bunting, Fantastic Furniture and Super Cheap Auto. The 3.5ha site is on the busy Maroondah Highway.
“This is our third joint venture with Troon Group, and we couldn’t be happier with the strong partnership we have built. This project continues to build on our long track record of success together,” MaxCap Group head of direct investment Simon Hulett said.
“The development represents a highly defensive retail investment backed by long leases to national tenants with strong covenants. We’re delighted it has been acquired after a highly competitive sales campaign and are pleased to deliver further amenity into the community.”
Chirnside Lifestyle Centre.
Troon managing director Tom McInerney said the developer identified the site in 2020 as part of the Kaufland supermarket portfolio.
“We had a strong conviction about the quality of the site and the opportunity. The site occupies a prominent elevated position on Maroondah Highway in an established retail precinct with 38,000 cars passing daily,” Mr McInerney said.
MLC Asset Management executive Mark D’Arcy-Bean said the centre was acquired as a core addition to the business’s large format retail portfolio, and he noted the opportunities for future development.
“The benchmark result reinforces the depth of buyer demand we continue to experience for bulletproof retail investments,” Colliers’ Mr McIntosh said.
“The limited supply of high-quality metropolitan shopping centres has seen a growing theme of increased interstate and offshore purchaser activity. The successful sale represents our second LFR transaction with the AM Property Plus trust and its first retail investment in Victoria.”
“Investors remain attracted to the fundamentals of the LFR sector, particularly as the population grows and further developments are restricted due to increased construction costs,” Stonebridge’s Mr Dowers said.
The trust picked up its first property in the sector when it paid $68m for a western Sydney centre developed by former Parramatta Eels chairman Roy Spagnolo and business partner Frank Carioti.
