YFG buys out Brisbane suburban shopping centre for $285m

YFG buys out Brisbane suburban shopping centre for $285m

YFG Shopping Centres has made a full purchase of Mt Ommaney Shopping Centre in Brisbane's south-west after dipping its toes in the property with a 25 per cent stake in November.

After purchasing its initial share in the property from Vicinity Centres (ASX: VCX) for $94.5 million, the South East Queensland shopping centre giant has now purchased the remainder from the UK's Nuveen Real Estate for $285 million.

This represents a miniscule premium in square metre terms on the price paid last year, itself a 3.3 per cent premium to the book value. 

Owned by the Fu family and based in the Brisbane suburb of Sunnybank, YFG is one of the nation's largest owners of shopping centres.

Its portfolio, including Australia Fair on the Gold Coast, as well as several centres in Brisbane including Brookside, Sunnybank Plaza and Toowong Village and Tower.

Real estate agency CBRE represented Nuveen in negotiations; a group with 1,724 properties worldwide an estimated AUD$180 billion in real estate assets under management (AUM).

Other assets Nuveen holds in Australia include a half stake in the Greenwood Plaza in North Sydney and a 33 per cent stake in Myer Bourke Street, Melbourne.

"Strategic, off-market transactions such as this, reinforce the ability for retail owners to secure competitive pricing outcomes in the current market," says CBRE's head of retail capital markets Pacific, Simon Rooney.

"We expect this trend to continue, as investors seek out high-quality, rarely traded retail opportunities offering attractive return parameters."

The centre in Mt Ommaney is anchored by a triple supermarket offer of Coles, Woolworths and ALDI, together with a triple discount department store offer of Kmart, Big W and Target.

Rooney believes the asset will continue to benefit from extensive population growth occurring in the region, and provides significant future redevelopment opportunities.

This includes an approved development application for a 11,481sqm expansion, including a state-of-the-art cinema, casual dining precinct and entertainment destination together with an improved bus interchange and increased parking.

The Mt Ommaney acquisition follows around $1.2 billion in sub-regional shopping centre transactions across Australia in 2019, including the CBRE-negotiated sales of Brimbank Shopping Centre, VIC ($153 million), Corio Central, VIC ($101 million) and the 25 per cent stake of Mt Ommaney Centre ($94.5m).

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