Charter Hall Buys Melbourne Mall From Hong Kong Investor for $139M

Burwood One in Burwood East, Victoria (Image: Charter Hall)

Charter Hall has purchased a regional shopping centre in Melbourne’s eastern suburbs for A$210 million ($138.7 million), marking the Australian fund manager’s second mall buy in as many weeks.

The acquisition of Burwood One in Burwood East was made on behalf of the A$2.5 billion Charter Hall Convenience Retail Fund and follows closely on the firm’s A$152.5 million purchase of Southport Park Shopping Centre in Queensland’s Southport, the company said in a release.

“The site is well positioned for future growth, given its proximity to Deakin University and the planned Suburban Rail Loop East, as well as future value-add with development potential,” said Charter Hall retail CEO Ben Ellis.

Burwood One’s seller was a Hong Kong investor who bought the mall in 2019 for over A$180 million and had been identified as Kowloon-based Si Feng in media accounts at the time.

Triple Anchored Assets
Situated 17 kilometres (10.5 miles) east of central Melbourne, Burwood One is fully leased and anchored by Coles, Kmart and Aldi. The mall also contains seven mini-majors, 40 specialty stores and eight kiosks, according to Charter Hall.

Charter Hall retail CEO Ben Ellis (Image: Charter Hall)

The site at the junction of Burwood Highway and Blackburn Road was home to Australia’s first-ever Kmart location in 1969 and was redeveloped into a 24-hour convenience-based retail centre in 2010.

Charter Hall’s acquisition price translates to A$7,895 ($5,222) per square metre for the property’s 26,598 square metres (286,298 square feet) of gross leasable area. Last week the firm picked up Southport Park, anchored by Coles, Aldi and Woolworths, from billionaire John Van Lieshout for the equivalent of A$7,663 ($5,066) per square metre.

“The high-quality Burwood One and Southport Park assets perfectly represent our strategy of investing in dual and triple supermarket anchored convenience shopping centres in strong metropolitan locations, with expectations of solid capital growth,” Ellis said. “CCRF will continue to deliver outperformance for our investors within a sector dominated by non-discretionary retailers.”

Retail Keeps Rolling
Charter Hall’s latest buy comes amid a red-hot market for Aussie retail complexes, with fellow Sydney-based fund manager MA Financial Group earlier this week revealing its acquisition of a regional mall in the suburbs southeast of Brisbane from Queensland Investment Corporation for A$678.7 million.

The transaction for the Hyperdome Town Centre complex in Loganholme — representing the largest-ever sale of a 100 percent interest in a Queensland regional shopping centre — built on MA’s recently announced A$393.8 million purchase from Blackstone of Top Ryde City Shopping Centre in Sydney alongside Singapore’s Keppel REIT.

In June, QIC announced its divestment of a Melbourne mall, Woodgrove Shopping Centre, to US-based PGIM Real Estate and Australia’s Assembly Funds Management in a A$440 million deal following a 28-year carry by the state-backed player.