IJ Capital exits Gold Coast mall

Benowa Gardens (outlined) spreads over a 1.76 hectare site with three street frontages.

IJ Capital has sold a Gold Coast mall after two years and a renovation.

Benowa Gardens, at Benowa, four kilometres west of Surfers Paradise, is trading to a local investment group for $60.5 million, reflecting a 4.99 per cent net passing yield.

Savills’ Peter Tyson represented the Brisbane based fund manager vendor, which paid Stockland $40.1m in late March, 2020, as the country went into lockdown.

That deal was struck at a 6.3pc return, also by Mr Tyson.

50pc uplift in less than two years

At 203 Ashmore Road, also the south east corner of Benowa Rd and Carrara Street, Benowa Gardens contains 5856 square metres of gross floor area fit out as 36 tenancies, four of which are vacant.

An additional freestanding building is rented to KFC.

The 1.766 hectare site includes 384 car parks.

“We recognised value-add opportunities with Benowa Gardens, consistent with the “core plus” investment of the fund [which held the asset],” IJ Capital founder, Scott Lai, said.

“We immediately undertook an active management strategy including centre upgrade works and a focused leasing plan successfully addressing a number of vacancies,” he added.

The anchor tenant, Coles, also renewed its lease.

“After stabilising the centre and significantly improving the income stream, [it] was briefly marketed in December 2021 and attracted multiple offers, resulting in a deal reflecting a capital uplift of more than 50pc in under two years,” Mr Tyson said (story continues below).

“Income streams underwritten by staple everyday needs, predominantly food and services, have proven resilient and are less prone to fluctuation from outside influences,” he added.

“The pandemic effects, social distancing restrictions and work from home, have bolstered performance in the smaller malls,” according to the executive.

“This underlying performance continues to drive an enormous weight of domestic and off-shore capital, both private and institutional, to target the asset class”.

Another Gold Coast mall deal

Elsewhere on the Gold Coast, in December, we reported IP Generation was paying QIC $200m for a half stake in Westfield Helensvale and the neighbouring ex-NightQuarter market site.

Not long earlier, Greenpool Capital, backed by Qualitas, acquired the Runaway Bay shopping centre for $260m in two parts, from Vicinity and Perron Group.

Five months ago, Panthera acquired the unbuilt retail component of Mermaid Waters’ The Lanes project.

That deal, with Sunland, was worth $45.8m.

Also last October, in one of the biggest retail transactions for 2020, worth $1.44 billion, AMP, Cbus and UniSuper acquired an 80pc interest in Broadbeach’s Pacific Fair shopping centre from an AMP-managed trust held for the Abu Dhabi Investment Authority’s Harina Company Limited, the Canada Pension Plan Investment Board and AMP Life Property Fund.

Two months later, the same buyers snapped up the 20pc balance from the Dexus Wholesale Fund for $422.5m.

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Marc Pallisco

A former property analyst and print journalist, Marc is the publisher of realestatesource.com.au.