Chinese investors set sights on big box retail

The Arena Shopping Centre in Officer sold to Chinese investors for $48 million.

Chinese investors are setting their sights on big box retail centres and larger retail properties, looking for defensive assets and income despite the focus on the looming entry of Amazon into Australia. 

More than $1.9 billion of shopping centres worth up to $150 million each have been sold to Chinese buyers based in Australia or overseas since mid-2014, according to a report from CBRE.

After offshore investors have been active in the office, residential and development spaces, shopping centres in unexpected locations are a new focus.

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“Given the level of development activity by Chinese developers in Australia it was only a matter of time before they realised the benefit of owning shopping centres,” CBRE national director Mark Wizel writes.

“(Benefits include) their strong cash flow, dominant locations (usually in the best section of any given suburb) and income anchored by either of Australia’s big two supermarkets (Coles and Woolworths) as well as complementary tenancy support from national speciality tenancies or a discount department store.”

Chinese investors are now looking for a broader range of retail assets, particularly centres in the $80 million to $100 million price range.

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