Wagga’s Sturt Mall sold for $73m

Sturt Mall in Wagga Wagga has sold for $73 million. Picture: Sturtmall.com.au.

The listed SCA Property Group has snapped up the Sturt Mall in the NSW regional centre of Wagga Wagga from the Dexus Wholesale Property Fund for $73 million.

The purchase, on an implied passing yield of 6.3%, will see the group acquire the centre that is anchored by a Coles supermarket and a Kmart discount department store.

SCA, led by Anthony Mellowes, says it will comment further about the acquisition at its full-year results announcement on Wednesday.

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The Dexus-run fund bought Sturt Mall in Wagga Wagga from LGS for $61.2 million in 2014 and remains on the hunt for high-quality shopping centres.

“DWPF is continuing to focus on high-quality dominant retail exposure in line with its strategy,” a spokeswoman said.

The 15,200sqm mall, which sits on a 3.8ha site, was sold by Sam Hatcher and Jacob Swan of JLL.

Sturt Mall is an enclosed subregional shopping centre in the heart of Wagga Wagga. It has a strong retail spending growth outlook and more than 80% of turnover is in non-discretionary items, in keeping with SCA’s focus on that area.

Spread across a single level, the asset’s major tenants include a Coles supermarket, Kmart discount store and 41 specialty stores, services and kiosks and four external tenancies.

SCA’s purchase comes as broking analysts say that sale may be stabilising for the best of retail real estate investment trusts.

UBS analysts nominated Vicinity Centres and Scentre as particularly important. The broker says specialty sales at Scentre, owner of local Westfield centres, were showing momentum.

“Evidence of sales growth stabilising after many periods of deterioration, positive feedback on non-core asset divestments and value creation from development pipelines (including mixed-use) will be well received,” UBS says, when previewing results from retail landlords.

This article originally appeared on www.theaustralian.com.au/property.