Revelop to launch Sydney’s first subregional in two decades

Salta Properties has sold a shopping centre development site at Jersey Road, Plumpton, to Revelop.

Property developer Revelop has capitalised on Sydney’s surging population and snapped up a site for a $200m-plus shopping centre on the city’s outskirts from Melbourne’s prominent Tarascio family.

Revelop has swooped on a block of land in Plumpton as the family’s Salta operation sells down assets – including a $200m industrial parcel in Melbourne’s Cranbourne – as it looks to fund its build-to-rent pipeline.

Revelop, which already owns centres around Sydney, plans to develop the plot into the city’s first major subregional shopping centre in more than two decades.

A combination of high building costs, lack of available land, high interest rates, and uncertain demand for retail space has crimped most projects.

But the stabilisation of shopping centre values after a series of transactions showing that subregionals remain in demand, particularly in metropolitan areas, has opened the window for Revelop to launch a new complex.

It is planned next to a major Lendlease property and will join Revelop’s network once completed. The group has made a name for buying retail assets, often from larger players and revamping them, as well undertaking its own projects.

Revelop directors Anthony El-Hazouri and Charbel Hazzouri.

New neighbourhood shopping centres, anchored by major supermarket chains, are constantly being developed. And some even include apartments, but the market has been starved of new subregional centres.

Developing larger regional centres is also effectively off the table, partly due to the difficulty of putting together the land parcels as well as the focus on housing and logistics, but also due to them no longer stacking up.

But new subregionals could become a feature in markets with healthy population growth and good catchments.

The sale was exclusively handled by JLL’s Nick Willis and Sam Hatcher in a direct off-market deal.

Salta acquired the land which adjoins Lendlease-run Plumpton Marketplace back in 2005. It won approval for a substantial 17,686sq m subregional centre in 2018 after legal action.

Mr Willis said core landholdings in the Sydney metropolitan area for shopping centre developments were extremely rare.

“The majority of these sites are acquired by the operators, Woolworths and Coles, due to fierce competition for key trading locations,” he said. The 36,900sq m site picked up by Revelop is also well-connected to the M7 and M4 motorways.

Revelop co-founder Anthony El-Hazouri said a new subregional shopping centre had not been built in Sydney for more than 20 years.

“We continue to acquire shopping centres and development sites in key locations which will deliver strong total returns and are supported by long term macro trends of strong population growth, improving gentrification, and limited new retail floor space supply,” Mr El-Hazouri said.

His co-founder, Charbel Hazouri, said the firm would take a proactive approach to the development and delivering a best-in-class centre.

“This acquisition adds to our portfolio in the region including Stanhope Gardens and Emerton Village” he said.

JLL’s Mr Hatcher said turbulent markets were creating opportunities.

“The retail sector is experiencing a resurgence in demand as capital looks for more stabilised pricing (versus traditional offices; industrial), supportive demographic tailwinds, and an ability to diversify income streams through redevelopment into alternative uses,” he said.