Stockland Cairns hits market with $230m price tag

Stockland is selling its shopping centre in Cairns.

Stockland Group is poised to capitalise on Australia’s white-hot sub-regional shopping centre market by offering a once-in-a-decade chance to buy one of Queensland’s largest retail hubs.

The retail centre giant is selling Stockland Cairns with an asking price of more than $230 million, in a bid to take advantage of the unprecedented activity in both the sub-regional shopping centre sector and in Queensland’s retail market.

Stockland Cairns is one of Queensland’s most significant shopping centres, with almost 50,000sqm of retail space and a strong line-up of anchor tenants.

Woolworths recently renewed its lease at the centre until 2036, while Target has signed on until 2022 and Harris Scarfe until 2026. It is also home to a Big W, Coles, a six-screen BCC cinema complex, 10 mini majors and 110 other specialty stores and kiosks.

Stockland will sell its shopping centre in Cairns for more than $230 million.

Stockland will sell its shopping centre in Cairns for more than $230 million.

The property is being marketed by JLL and will be sold via an international expressions of interest campaign that ends on March 31.

Stockland’s move comes after sales of Australian sub-regional shopping centre exploded in 2015, with transactions totalling $2.8 billion –  a $1 billion increase on the previous year.

And investors were particularly enamoured with Queensland’s retail assets, boosting sales to a record $2.3 billion, well in front of the $1.4 billion sold in 2013 and the $1.7 billion transacted in 2014.

There have been very few opportunities historically to acquire a 100% interest in a major, high quality retail asset over $200 million in Queensland

JLL’s Australasian head of retail investments, Simon Rooney, says opportunities to buy retail assets worth more than $200 million in Queensland are extremely rare.

“There have been very few opportunities historically to acquire a 100% interest in a major, high quality retail asset over $200 million in Queensland. We have recorded just three transactions above this threshold in the last 10-years,” Rooney says.

Stockland Cairns is spread over an almost 50,000sqm site.

Stockland Cairns is spread over an almost 50,000sqm site.

“One of those transactions occurred directly off-market and one was part of a national portfolio.”

Rooney says the shortage of retail stock that drove investors further from Brisbane last year remains in play early in 2016.

“We expect Stockland Cairns will be highly sought after given the high level of demand for major retail assets in Queensland and the shortage of opportunities to acquire major assets,” he says.

“The resurgence in inbound tourism, which follows the depreciation in the AUD, is supporting the local economies of major tourist regions such as Far North Queensland. Overseas visitor arrivals have increased by over 7% year-on-year, nationally, which supports a positive outlook for retail trading conditions.

“The Queensland retail market offers an attractive long-term investment proposition, with retail turnover growth forecast to outperform the national average over the next decade, improving occupancy levels and a boost to retail trading conditions in the short to medium term from strengthening tourist arrivals.