Vicinity takes major hit on Perth mall

Vicinity spent c$100 million refurbishing Midland Gate before offering it in 2019.

Four years after listing it with $650 million price hopes and 18 months since a $530m deal to Elanor Investors Group was scuppered, Vicinity Centres is speculated to sold Perth’s Midland Gate.

Westbridge sold Midland Central (outlined), near Midland Gate, last week.

The 14.4 hectare Town Centre zoned shopping centre with c68,600 square metres and 3059 car parks is believed to be trading to fund managers, Hong Kong’s PAG, or Pacific Alliance Group, and Fawkner Property, from Melbourne.

The speculated price of c$465m includes management rights.

Colliers’ Lachlan MacGillivray with CBRE’s Simon Rooney represented the vendors, Vicinity Centres and a mandate, the Vicinity Retail Partnership, a former Novion trust backed by the Future Fund and Canada Pension Plan Investment Board.

Vicinity has held it 24 years. It was developed in 1980.

The disposal comes six days since we reported Westbridge Funds Management sold the nearby mall Midland Central for $19.3m – a 6.4pc yield and a rise on the ($12.2m) price it paid in 2012 before renovating.

Cygnet West’s Wayne Lawrence and Tim Scott marketed that property.

Value freefall

Midland Gate was listed two years after the landlords completed a c$100m refurbishment and extension.

Had it sold at that guide, the net passing yield would have circled nearly six per cent (story continues below).

Instead, post COVID, and following two years of tepid demand for major shopping centres, returns for some recent malls are near double digits.

Seventeen kilometres north east of Perth’s CBD, Midland Gate’s trade area captures nearly 240,000 customers.

Ace Cinemas and Target are amongst the other occupiers.

The acquisition comes four months since PAG purchased a Sydney CBD office, 44 Market Street, for $393.1m – a c15pc discount on valuation – from Dexus.

Four weeks ago the group paid KKR $1.4 billion for the Australian Venue Co business and 210 venues.

PAG also recently seized control of Patties Foods, owner of Four’N Twenty and Nanna’s, and Vesco Foods, which holds Lean Cuisine – outlaying c$550m.

It sold The Cheesecake Shop business though, to Melbourne based River Capital.

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Marc Pallisco

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