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Frasers Property JV expects sale of last 3 retail assets in Sydney project to fetch over A$170m
THE final three retail assets in Frasers Property Australia and Japanese developer Sekisui House's A$2 billion (S$1.93 billion) mixed-use Central Park development in Sydney's central business district (CBD) are being put up for sale in a single deal that is expected to fetch more than A$170 million.
With the flagship 12-year project now nearing completion, the joint venture (JV) will divest the remaining three retail assets – Central Park Mall, DUO Retail (eight retail outlets) and Park Lane Retail (six retail outlets) - as a single block. The transaction is the final component of the partnership’s divestment strategy, the companies said in a joint statement on Tuesday.
Colliers International's head of retail investment services, Lachlan MacGillivray, has been appointed to sell the CBD retail assets via an International Expressions of Interest campaign starting in early May.
Known for its vertical gardens and heliostat, the development was formerly a brewery site that was converted into a mixed-use precinct with retail, commercial, hotel, student accommodation and residential uses, integrated with lifestyle options.
Mick Caddey, development director of Frasers Property Australia, said: "Central Park has redefined urban living in Sydney and Central Park Mall is the natural heart of this community. The precinct has won multiple awards in design and liveability, and we are searching for the right buyer to keep the retail offer evolving.
"These retail assets serve a large and growing catchment from a highly prominent and easily accessible location, surrounded by Australia’s leading universities and education precincts with over 115,000 students within walking distance of the centre."
He added that the neighbouring Central Station, which is undergoing a A$955 million upgrade, is less than a 500 metre walk away.
Central Park Mall opened in late 2013. It is anchored by a Woolworths supermarket and the Palace Cinema complex, and includes an open green space ideal for events, the companies said. Its 14,600 sq m of gross lettable area across five levels also comprise a mix of entertainment, fashion and experiential retailing, complemented by an alfresco dining precinct.
Colliers' Mr MacGillivray noted that the Central Park precinct continues to "grow from strength to strength", with customer traffic having grown 33 per cent, and sales up by 56 per cent since 2014.
According to data from Colliers, recent sales of Sydney CBD retail assets highlight "strong investor demand", with Pitt Street's Soul Pattinson Building being sold for A$95 million at a 4 per cent yield.
Mr MacGillivray anticipates that the retail assets will receive keen interest from private and institutional purchasers, given its quality and profile, he said.
As at 11.13am on Tuesday, shares in Frasers Property was trading at S$1.83, down 1.6 per cent, or three Singapore cents.