Elanor acquires Sydney’s Neeta City shopping centre
The listed Elanor Investors Group has set up a new managed fund to acquire the Neeta City shopping centre in the Sydney suburb of Fairfield for $85.3 million.
The deal puts on display the group’s confidence that it can turn around the performance of the retail complexes that it has bought in NSW and Victoria.
Elanor picked up the centre from funds group Arcadia and will reap the income from its anchors, Big W and Woolworths, while working out how best to realise value from the 2.2ha site near Fairfield station.
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The deal, flagged by the Australian last December, was brokered by Lachlan MacGillivray and James Wilson of Colliers International.
The acquisition reflected a passing yield of 7.8% and a purchase price of $3450 per square metre of lettable area and was at well below its replacement cost.
In keeping with the current focus of shopping centre buyers Neeta City is a convenience-based complex focused on everyday goods and services.
Elanor said the 24,750sqm centre “presents significant opportunities to add value through repositioning”.
The centre has more than 70 specialty non-discretionary focused goods and services retailers as well the Woolworths supermarket and a Big W discount department store.
Elanor chief executive Glenn Willis says the purchase follows the group’s recent acquisition of the Waverley Gardens shopping centre in Melbourne from US group Blackstone.
“Like Waverley Gardens, this investment further demonstrates Elanor’s strategy of acquiring high quality real estate where we see the opportunity to unlock value through our active asset management approach,” he says.
Elanor co-head of real estate, Michael Baliva, says Neeta City has significant value-add potential given its Fairfield CBD location and opportunities to introduce more productive commercial uses.
“Our strategy is focused on enhancing both the income and capital value for our Fairfield Centre Syndicate capital partners,” he says.
This article originally appeared on www.theaustralian.com.au/property.