IOOF snares new Melbourne homemaker centre

Chirnside Lifestyle Centre abuts a proposed housing estate.

Troon Group and MaxCap have sold a Chirnside Park large format retail investment developed on a block bought from German hypermarket chain Kaufland in early 2020.

The Chirnside Lifestyle Centre at 266-268 Maroondah Highway is trading for just over $50 million, reflecting a sub 5.3 per cent net yield.

IOOF paid $41 million for 39 Brisbane Street, Barton, last year.

IOOF is the buyer, the asset will be held by the AM Property Plus Trust, part of the Direct Property Portfolio, managed by MLC Asset Management, the investment division of ASX-listed Insignia Financial Group.

The investment will be the fund’s maiden in Victoria.

The recently completed Great Western Centre cost IOOF $68 million in 2021.

Last year, the Melbourne based manager, for that trust, paid $41m for a Barton office, home to the Australian Medical Association, BAE Systems and Spirit Super.

That vendor was Quintessential Equity, which outlaid $16.5m in 2017 then renovated.

In 2021, meanwhile, IOOF acquired Minchinbury’s Great Western Centre homemaker centre – outlaying $68m.

Colliers’ Tim McIntosh, James Wilson and Mike Crittenden with Stonebridge’s Justin Dowers, Kevin Tong and Philip Gartland marketed the Chirnside Lifestyle Centre.

Third development for Troon, MaxCap

Troon and MaxCap constructed the 11,000 square metre Chirnside Lifestyle Centre on 3.5 hectares of a (3.9ha) Commercial 1 zoned site Kaufland had earmarked for a store before making the surprise decision not to open in Australia.

The developer and financier paid $14.312m.

It was the pair’s third project: the others, which were sold-down in late 2020 and early 2021, were the Ballarat Lifestyle Centre at Delacombe, which collected $12.9m and a renovated Surry Hills office – formerly the Salvation Army’s headquarters – that traded for $28m.

The partners also three years ago divested a Narre Warren car yard leased to Jowett Motor Group for a BMW dealership, for $17m to Eildon Capital.

At Chirnside Park, meanwhile, Troon and MaxCap offloaded the balance 4000 sqm of the block to fast food chains KFC and McDonald’s, which since opened restaurants.

Also in the pocket is a purpose-built Dan Murphy’s bottle shop which sold for $12.52m in mid-2020.

That seller, George Kepper, was the one who sold the Maroondah Highway site which made way for the Chirnside Lifestyle Centre, to Kaufland (story continues below).

Chirnside Lifestyle Centre

Completed in December, the Chirnside Lifestyle Centre is fully leased; tenants include Baby Bunting, Chemist Warehouse, Fantastic Furniture, Harris Scarfe and Supercheap Auto.

The Weighted Average Lease Expiry is 7.7 years.

There are also 286 car parks.

Given the zoning, the block has longer term development upside which could include offices and residential.

“The benchmark result reinforces the depth of buyer demand we continue to experience for bulletproof retail investments,” Mr McIntosh said.

“Chirnside Lifestyle Centre offers all the key investor ingredients, with a core metropolitan Melbourne location, significant weighting to national retailers on long leases, attractive rental growth and backed by underlying land value,” he added.

“The successful sale represents our second LFR transaction with the AM Property Plus trust and its first retail investment in Victoria,” according to the executive.

Chirnside Park is about 32 kilometres north east of Melbourne’s CBD.

“The site occupies a prominent elevated position on Maroondah Hwy in an established retail precinct with 38,000 cars passing daily,” Troon Group managing director, Tom McInerney, said.

“Through our relationships with the major retailers, we were able to quickly secure a mix of tenants that complement the precinct and de-risk the project with MaxCap,” he added.

The property will be the first in Victoria for the AM Property Plus trust.

“Being a brand new construction with annualised growth, Chirnside Lifestyle Centre will become w welcome addition to our LFR portfolio, given its strategic location in a rapidly growing area with opportunities for future development,” MLC Asset Management manager, Mark D’Arcy-Bean, said.

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Marc Pallisco

A former property analyst and print journalist, Marc is the publisher of