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Diversified property group Dexus has raised $78.9 million in the sale of the Homemaker Prospect centre to the acquisitive investment group AsheMorgan, in a sign large format retailing has not lost its appeal.
Prospect Homemaker is a 26,000 square metre centre in Sydney’s west, with 28 showrooms occupied by brands including Fantastic Furniture, The Good Guys, Snooze, Beacon Lighting and Bing Lee. It’s located in one of the fastest growing catchments in the country.
AsheMorgan has acquired Homemaker Prospect from Dexus for $78.9 million.
JLL’s Nick Willis and Sam Hatcher advised on the sale on behalf of Dexus, which paid $64.2 million in 2019 for the centre from Altis.
Dexus is an ASX-listed real estate investment trust and the country’s largest office landlord, with a market value of $8.37 billion. Chief executive Darren Steinberg has said the focus for Dexus is its growing healthcare and logistics sectors, and he will look to sell what the business considers non-core retail assets.
AsheMorgan and its investment partner Blackrock sold Sydney’s Crossroads Homemaker Centre in October to LaSalle Investment Management for $282 million through JLL’s Willis and Hatcher. They paid $140 million for the centre in 2018.
AsheMorgan is a private investor in high-end property that has the opportunity for redevelopment. It has more than $4 billion in its investment and development pipeline and has made over $10 billion in transactions.
Dexus chief Darren Steinberg says the company’s focus is its growing healthcare and logistics sectors.Credit:Jessica Hromas
“Of the five largest retail transactions completed in Australia in 2022 three have been large format retail assets,” Willis said.
“These have included more recently the sale of Crossroads Homemaker, Homeworld Helensvale for $265 million and Alexandria Homemaker for $200 million, sold to Goodman for last mile conversion.”
The deal for Prospect Homemaker takes the total sales volume for the malls for 2022 to a five-year high. It reflects the intensified demand for LFR assets because of the category’s resilience over the past two years.
Willis said JLL has transacted more than $750 million worth of large format retail assets so far this year. The centres are traditionally greater than 3000 square metres and the sector currently accounts for $95.6 billion or 26.4 per cent of all Australian retail trade.
Hatcher said the large format retail sub-sector performed “exceptionally well”, recording the most significant yield compression across all retail sub-sectors in 2020 and 2021. Yields tightened by 105 basis points between the end of 2019 and the final quarter of 2021.
JLL Research shows that pandemic-induced lockdowns and travel bans were a significant tailwind as household goods spending remains elevated at 31 per cent above pre-pandemic levels. The jump in spending has been driven by strong renovation activity and a sharp increase in demand for home office furniture and equipment.
“The acceleration in spending was primarily driven by strong renovation activity and a sharp increase in demand for home office furniture and equipment, with consumers spending almost $1.4 billion more a month than pre-pandemic,” JLL’s head of capital markets research, Andrew Quillfeldt, said.
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