Newmark Swoops in on Vicinity Mall for $135m


Former Hawthorn AFL star Chris Langford and his syndicate fund Newmark Capital which he co-founded with Simon T. Morris has picked up Brandon Park shopping centre in Melbourne for $135 million.

Co-owned with Telstra Super by mall owner Vicinity Centres, the Brandon Park mall in Wheelers Hill is located around 24 kilometres’ south-east of Melbourne and continues the divestment of non-core assets by Vicinity as it focuses on larger assets.

The 23,000-square metre Brandon Park shopping centre is anchored by Coles, Aldi and Kmart.

The transaction was negotiated by JLL’s head of retail investments Simon Rooney on a passing yield of 6.7 per cent. Vicinity will receive $67.5 million for its share.

“Victorian retail assets are tightly held and are generally highly sought after given their relative scarcity, especially in Metro locations,” Rooney said.

Related reading: Fort Street Capital Swoops on $83m NSW Regional Shopping Centre

“Brandon Park is one of only four sub-regional centre transactions within the Melbourne metro area since 2015.

“Unlisted funds continue to be drawn to the sub-regional sector given the attractive yields available relative to premium core assets.”

Rooney said that transactions of sub-regional centres dropped to $1.1 billion in 2017, less than half the $2.4 billion per annum which sold between 2013 and 2016.

“We are pleased to progress the divestment of our non-core assets,” Vicinity chief executive Grant Kelley said.

“Following on from the sale of our 50 per cent interest in Toormina Gardens in January 2018, we have now agreed the sale of approximately $109 million of assets this financial year, for a combined 3.1 per cent premium to their book values.”

Shopping C2

The Brandon Park centre is expected to settle at the end of this month. Newmark will work on a plan to put in front of council to upgrade the centre.

Related reading: Maroondah Village Shopping Centre Site Hits the Market

A Newmark Capital fund owns and is conducting a $450 million redevelopment of South Yarra’s Jam Factory retail complex which will see it rebuilt as a 15-storey $1.25 billion retail and office complex.

Earlier this month Vicinity Retail Partnership sold a 50 per cent interest in the $430 million Grand Plaza Shopping Centre in Brisbane’s Browns Plains at a six per cent yield to US fund manager Invesco.

The Vicinity Retail Partnership also recently sold a 50 per cent share in West Australia’s Rockingham Shopping Centre to AMP Capital for $305 million. It will continue to own its own half stakes in both the Browns Plains and Rockingham malls along with the valuable management and development rights.

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