Shopping Centre

Australian department store David Jones is poised to launch the sales process for its $1bn property portfolio, with promotional material being sent out to the market next week.

Shoppers appear to be flocking back to stores, with the owner of Westfield malls in Australia saying customer visits are getting close to the levels of a year ago, but Melbourne’s coronavirus outbreak will force some retailers to wind back their operations.

Shoppers are heading back into malls, but not at the same rate as before the coronavirus struck and smaller convenience-style shops are beating out larger regional centres that were traditionally at the top of the property tree.

A Woolworths-anchored mall in Melbourne has been snapped up by a Sydney investor for a cool $21.3 million – a deal that shows investor appetite remains strong, according to industry experts.

The shopping centre industry believes it can come through its current rough patch with investors backing the $1.4bn equity raising by Vicinity Centres amid concerns there is more pain ahead for shopping centre landlords.

The Lowy family-backed Assembly Funds Management has teamed up with a company run by a scion of Melbourne’s Buxton family to buy a shopping centre in the city’s northwestern suburb of Sunshine for $39 million.

Shopping centre landlords face a steep fall in rents of about 20% when the Morrison government’s stimulus package ends later this year, according to Morgan Stanley analysts.

YFG Shopping Centres has taken full ownership of Brisbane’s Mt Ommaney Centre, in a deal that values that asset at about $380m and which is the largest retail property deal of the year.

Shopping centre and office landlords were cautiously encouraged by the federal government’s blueprint for rolling back restrictions on retail trading and workplace gatherings, welcoming the prospect of an end to disrupted trading on the horizon.