Lendlease sells Darling Square retail component
Lendlease has sold a retail component of Haymarket’s $3.4 billion Darling Square.
The fully occupied leasehold asset – 44 tenancies with 4516 square metres across a 9639 sqm footprint comprising north east, south east and south west stratums, is speculated to be trading to the local Yoon family, which holds other hospitality assets.
The $88 million result is about 10 per cent less than expectation when it hit the market in October.
Reflecting a fully let net yield of c5.97 per cent, it prices lettable area at $19,485 per sqm.
Lendlease will continue to act as manager.
It will also retain the retail component beneath the Darling Square office.
“Darling Square’s retail amenity…is a thriving, fully leased precinct in the heart of Darling Harbour,” a Lendlease spokesperson said.
“The divestment of this retail component is consistent with our strategy to recycle capital,” they added.
Darling Square
Completed in 2019, and with tenants including McDonald’s and Starbucks, the retail space services a mixed-use precinct with 1500 own-your-own apartments, 1300 student accommodation suites, 26,000 sqm of office space and a 590 suite hotel (story continues below).
All up, there is c12,000 sqm of retail.
The pocket is near Central Barangaroo, Paddy’s Markets, the new Sydney Fish Market and Darling Harbour.
“The precinct is highly connected to the broader…metropolitan region,” Colliers’ Lachlan MacGillivray, said.
“Home to some of Sydney’s best food operators, Darling Square Retail attracts foot traffic from residents, office workers, students and tourists,” he added.
“Underpinned by strong sales productivity and sustainable occupancy costs, the precinct offers a secure platform for substantial rental growth,” according to the executive.
The deal comes three months since Lendlease sold Settlement City – Greater Port Macquarie’s largest shopping centre – to Melbourne’s Fawkner Properties.
The group last year also divested two Cairns malls – the Smithfield Centre, to Alceon Investments – speculated to reflect a c7.5pc return – and Cairns Central, to McConaghy Properties, on a circa-six per cent yield.
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