$500m portfolio of Qld malls up for grabs
A $500 million portfolio of five neighbourhood malls in south-east Queensland, controlled by Melbourne investment house CVS Lane and Don O’Rorke’s Consolidated Properties Group, has hit the market, the latest test for investment in the retail sector.
CVS Lane, a family office style investment platform backed by the Libermans, and CPG, a prominent Queensland developer led by industry veteran Mr O’Rorke, have steadily accumulated the portfolio, buying existing neighbourhood centres then redeveloping them.
Lee Centra, CVS Lane’s chief executive, said there had been unsolicited offers for the properties over the past 18 months, a reflection of the strong demand for such retail assets in south-east Queensland.
“Our strategy has always been to hold these assets for the medium to long term to deliver a strong and growing source of income for our investors,” he said.
“The assets have gone from strength to strength in terms of their valuations and sales performances and proven very resilient in the face of major disruptions in recent years, such as the pandemic and severe weather events.”
The centres, all anchored by either Coles or Woolworths supermarkets and in some instances both, are in high-growth areas across south-east Queensland: Karalee, Palm Beach, Wilsonton, Springwood and Keperra. In total, the portfolio has about 65,000 square metres of retail space.
All five assets are in separate trusts, with multiple investors in each, which CVS Lane and CPG manage.
“Our strategy has always based around finding assets that offered strong refurbishment and development potential to hold for the long term. We have invested to that end accordingly,” said Mr O’Rorke, CPG’s chief executive.
“We regularly look for new value-adding opportunities and we feel this is a good time take these assets to market.”
The portfolio will be offered either in one line, by single assets, or any combination of assets. Each centre has recorded solid increases in valuation since acquisition, driven largely by the substantial upgrade works, with each offering further development potential.
JLL’s Jacob Swan and Sam Hatcher and CBRE’s Joe Tynan and Simon Rooney are brokering the portfolio.
Mr Swan said investor demand had swung strongly in favour of neighbourhood retail properties as defensive assets with low income volatility, given the broader economic uncertainty.
“There remains significant equity capital available for low-risk retail assets, from a range of domestic and offshore institutional sources, such as pension funds and unlisted core funds,” Mr Swan said.
Through last year, there were 61 neighbourhood centres sold nationally, hitting a record deal volume of $2.45 billion, 22 per cent above the previous high in 2019, he said.
