Wealthy Melbourne families take part in $175m shopping centre shopping spree

The Village Lakeside Shopping Centre in Pakenham is tipped to make about $25m with interest from buyers including wealthy Melbourne families and individuals.

MELBOURNE’S wealthiest families are expected to take part in a more than $175m shopping centre shopping spree this autumn.

Four neighbourhood plazas are up for grabs across Victoria in a listings rush that is close to the total number that changed hands last year.

And commercial property agents are tipping super rich private investors to chase the “recession proof” properties.

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The priciest retail hub to hit the market so far is the Williams Landing Shopping Centre at 100 Overton Rd, which is expected to make $80m.

Stonebridge property Group are handling the sale and national partner Justin Dowers said while buyers for the properties were still diverse, wealthy individuals were “resonating towards the sector”.

“There’s definitely an increase in interest from private investors, but on the basis that Real Estate Investment Trusts (REITs) were highly competitive a year ago,” Mr Dowers said.

“So they (private investors) are starting to resume an even playing field.

“And some of the bigger funds backed by private investors have been buying some of the bigger shopping plazas because there’s quite a bit of value there.”

The Williams Landing Shopping Centre at 100 Overton Rd, Williams Landing, is expected to make about $80m.

He added that shopping centres have been performing particularly well in the past year, with occupancy in most at close to 100 per cent.

“They have always been considered as recession proof, but they are also considered the best hedge against inflation,” Mr Dowers said.

“They are super secure and they deliver growth.”

Expressions of interest for the Williams Landing property closed earlier this month, with a number of wealthy families and individuals understood to have inquired.

The Cranbourne West Shopping Centre at 665 Hall Rd was also expected to attract bids beyond $45m when expressions of interest closed on March 15.

Stonebridge is sharing the listing with Colliers, and the latter’s retail middle markets director Tim McIntosh said private investors were “perhaps more enamoured with the space”.

Cranbourne West Shopping Centre and the land surrounding it located at 665 Hall Rd could make more than $45m after being listed for sale this autumn.

This included family wealth management funds, syndicates between a small cluster of well-off groups and even ultra-high-networth individuals.

Pakenham’s Village Lakeside Shopping Centre is expected to make close to $25m for owners MPG Funds Management and is seeking buyer interest before 5pm March 30.

The 3654sq m building is set on an 1.122ha property with tenants including Coles.

JLL retail investments senior director Stuart Taylor said most of the tenants were medical groups, food, grocery and package liquor stores in a mix that was likely to appeal to investors seeking resilient tenants as interest rate hikes affect consumer spending.

Mr Taylor added that just five neighbourhood shopping centres changed hands across 2022, but 2021 had been a “record year” with 18 traded.

The Village Lakeside Shopping Centre in Pakenham is tipped to make about $25m.

“Last year there was low confidence in the market from both buyer and seller perspectives, but there’s a bit of renewed confidence in the market this year,” Mr Taylor said.

CBRE’s Scott Hawthorne is among the team selling the Co Store shopping centre at 86-88 Ovens St, Wangaratta, which includes a Target and a number of smaller retailers.

The property is expected to make $25m-$30m when it changes hands after an expressions of interest campaign that ended on March 22.

Mr Hawthorne said anchor tenants like Wesfarmers (who own Target) were proving attractive to high-net-worth investors and family offices.

However, he wasn’t prepared to rule out interest from international parties and noted long term buyer activity showed 35 per cent of bids on Victorian shopping centres had come from “investors with Asian heritage”.

The Co Store at 86-88 Ovens St, Wangaratta, could make as much as $30m.

Last year the Shepparton Market Place sold to Singaporean fund manager Sim Lian Metro-Capital for $88.095m.

Last month, Forza Capital bought the Epping Home retail centre last month.

The investor group draws its funds from some of Victoria’s wealthiest families who tip in anywhere from $200,000 to millions of dollars, and splashed $70.25m on the purchase.

The shopping hub included stores from Office Works to Chemist Warehouse, though Forza director Ashley Wain said they felt the site could support “more intensive mixed-use development” and intended to try to lure in some more high-profile brands in the short-term.

“We hope to expand on it in the near future,” Mr Wain said.

“Add additional floorspace with a chance to change up the tenancy mix. And there’s a lot more population growth in the catchment ahead.”

He added that he believed they would be buying more properties this year.

The Epping Hub homemaker centre sold to Forza Capital in February.

“There’s an element of volatility in the property market at the moment with various sectors getting repriced on the back of changing yield and cap rates, and in this sort of environment it’s a good buying window for active managers like Forza,” Mr Wain said.

JLL’s Mr Taylor noted the price was $1m over what the property had been professionally valued at as part of Home Co’s, its vendors, disclosure requirements.

Colliers’ Mr McIntosh is also representing the sale of a future development at 21 Station St, Wallan, which is taking expressions of interest for those hoping to build the site which is permitted to include a small supermarket, child care centre, tavern and a number of other retail spaces.

“We are quoting in excess of $600 a square metre ($4.95m-plus),” Mr McIntosh said.

“At completion the value on an asset will depend on the tenant composition, but it would comfortable be worth in excess of $20m.”

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