SCA spends $112m on Ballarat shopping centre
SCA Property Group has spent $112 million on the Delacombe Town Centre, in a growth corridor south west of Ballarat.
The vendor, Troon Group, only completed the asset four years ago.
On 6.5 hectares at 315 Glenelg Highway, at the south west corner of Cherry Flat Road, it contains 19,098 square metres anchored to Woolworths, Kmart, Dan Murphys and ShowBiz Cinemas.
There are also 35 specialty stores.
The off-market deal, brokered by JLL’s Stuart Taylor and Sam Hatcher, reflects a fully let yield of 5.34 per cent.
It comes 11 months since Troon sold the 11,710 sqm Ballarat Lifestyle Centre, across the road at 29 Cherry Flat Rd, for $12.4m.
Also in January, the vendor banked c$27.75m for a Mont Albert office, 3-7 Hamilton Street.
That purchaser was Larkfield, directed by Frank Hargrave who established the now listed Skilled Engineering in 1964.
Delacombe Town Centre
Delacombe Town Centre and the Ballarat Lifestyle Centre form part of the 1290ha Ballarat West Growth Area precinct, where population is forecast to double to c36,000 people within two decades.
“The sale of Delacombe Town Centre sets a new benchmark [yield] for non-metro sub regional shopping assets…across Australia,” Mr Taylor said.
“The strong pricing achieved is a function of heightened investor demand for quality convenience retail assets given their relative value and resilience in recent times, coupled with limited supply of opportunities in this asset class,” he added.
“Private investors and syndicates have been the dominant buyers in the sub-regional class this year, however appetite from institutional investors is returning for best-in-class assets – a trend we expect to continue in 2022” (story continues below).
Mr Hatcher said that c$1.6 billion of sub-regional centre transactions have occurred this calendar year to date compared to $687m in 2020.
“We are experiencing growing demand for quality sub-regional assets from a range of private and institutional capital sources, both domestically and offshore, which is driving more competitive pricing and yield compression,” he added.
“Given the record of demand for non-discretionary focused neighbourhood shopping centres, investors are clearly now moving up the price/risk curve seeing opportunities to secure assets”.
SCA on a roll
SCA has been one of the most acquisitive shopping centre investors this year.
A fortnight ago we reported the ASX listed group outlaid $54.5m for the four month old Moggill Village, south west of Brisbane.
That deal, with Don O’Rourke’s Consolidated Properties was struck at a 4.95pc yield.
Also last month the buyer snapped up Moama Marketplace, Woodford Village and Warrnambool Target for a total $53.6m.
Last quarter, SCA spent $34.4m on Toowoomba’s Drayton Central, its third regional Queensland retail investment this year after Cooloola Cove and Mt Isa Village.
Within a week in June, the group also picked up two Newcastle shopping centres – Marketown (for $150.5m) and Raymond Terrace ($87.5m).
Eleven months ago it outlaid $55.4m for Katoomba Marketplace in Sydney’s Blue Mountains.
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