Lendlease offer biggest mall in FNQ
Lendlease is selling Far North Queensland’s only regional shopping centre and the management rights which, between 2007-2011, it fought former part-owner Westfield to keep.
Cairns Central, bound by Aplin, Bunda, McLeod and Spence streets, incorporating the Cairns train station, is expected to trade for about $500 million.
It is the latest asset in the institution’s Australian Prime Property Fund Retail to be offered; earlier this month it divested Craigieburn Central, in Melbourne, to IP Generation for about $300m.
Last year, meanwhile, the trust sold Mackay’s Caneland Central to Sentinel for c$500m.
Like the Mackay property, Lendlease has held Cairns Central since 2001 – originally as a half stake.
In 2011 it snapped up the balance from Westfield following a protracted legal battle by that investor to manage it.
Colliers’ Lachlan MacGillivray and McVay Real Estate’s Sam McVay are the agents.
“Cairns Central is the best quality asset to hit the market in recent times against a backdrop of capital refocusing attention on ultra-defensive and dominant assets,” Mr MacGillivray said.
“Unlike other periods of economic uncertainty, there is no deficiency of capital in the market and quality assets located in strong locations like Cairns Central continue to source high demand,” he added.
Elsewhere in Cairns,1700 kilometres north west of Brisbane, Ingenia Communities recently outlaid $19.5m for a Land Lease Community site at Gordonvale, set to accommodate 275 dwellings.
In 2021, meanwhile, Jaz Mooney’s Oxford Hotels picked up the Grand Hotel, in the CBD, for $13.5m.
That seller was Stronghold Investment Management which outlaid $8.5m two years earlier, then renovated.
Cairns Central
Once considered the best shopping centre in Lendlease’s retail portfolio, Cairns Central spreads a 9.4 hectare block with development upside.
Completed in 1997 by Suncorp and Coles-Myer, it contains 51,972 square metres tenanted to 186 groups with a Weighted Average Lease Expiry, by area, of 6.3 years (story continues below).
Coles, Event Cinemas, Kmart, Myer, Target and Woolworths are the anchors.
Mini majors include Best & Less, JB Hi Fi and Rebel.
All up, the centre generates close to $500m in sales.
There are also 2564 car parks.
“A 100 per cent interest in a regional shopping centre with management rights is seldom offered to the market, with only two sales recorded since 2015,” Mr MacGillivray said.
On top of that, he added, Cairns Central is one of the country’s best performing retail investments – a four hour drive from the nearest competing regional shopping centre.
The mall attracts 8.88 million annual visitors.
On average each shopper spends $54.34 – a number forecast to rise 10.8pc for each of the next four years.
The total trade area population of 241,208 has a spending power of $3.6 billion, the agents said, expected to nearly double (to $6.9b) by 2041.
“With specialty occupancy costs of 12.3pc and productivity of $14,122 per sqm, the centre represents one of the most secure and defensive income streams in Australia,” Mr McVay said.
“Domestic visitor numbers to Tropical North Queensland are up 27pc compared to pre-COVID and international travellers are only starting to rebound,” he added.
“As the gateway to Tropical North Queensland, Cairns is poised for a period of exciting growth and Cairns Central will be a major beneficiary of this,” according to the executive.
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