JLL sells Parkes Arbour Shopping Centre with a significant vacancy from Target’s 2021 national store closures
News release
30 August 2023
Regional NSW shopping centre transacts with plans to reposition
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SYDNEY, 31 August 2023 – A regional neighbourhood shopping centre in NSW has sold for $8.9 million to a Sydney-based private investor, as demand for neighbourhood centres with value-add opportunities continues to outstrip supply.
JLL’s Sebastian Fahey, Dylan McEvoy, Nick Willis and David Mahood sold the shopping centre via an Expressions-of-Interest campaign on behalf of a Brisbane-based private investor, achieving a passing yield of 4.85%.
In 2021, parent company Wesfarmers announced the closure or rebranding of more than 160 sites with many of the locations being rebranded to Kmart/K-Hub. The increasingly competitive market was too much for the Target business with landlords scrambling to backfill the vacancies.
Parkes Arbour is anchored by a Coles supermarket and supported by a Liquorland and two speciality retailers. The asset included a 4,019sqm vacant ex-Target space, allowing an opportunity to reposition and or redevelop the centre.
JLL’s Sebastian Fahey from the NSW Retail Investments team said, “Opportunities to acquire neighbourhood shopping centres with value-add upside are becoming increasingly rare as transactions in 2023 are down considerably. NSW neighbourhood transaction volumes totalled $124.4 million year to date, down more than 70% this time last year.
“Parkes Arbour Shopping Centre offered the purchaser an attractive repositioning play with the potential to significantly increase the centre’s income by splitting the major vacancy into smaller offerings. This resulted in the campaign attracting unprecedented demand for a regional neighbourhood centre with over 200 groups and 10 offers being received at the close of the campaign.”
Colleague David Mahood added “Parkes Arbour reaffirms the increase in demand for retail assets with value-add initiatives. Investors are continuing to seek these opportunities as they provide a secure holding income with significant upside through a repositioning play and or further development.”
In 2023, JLL has transacted nearly $90.0 million worth of neighbourhood centres in NSW including Schofields Village which was sold for 5.55% and Elermore Vale Shopping Centre on behalf of Tamim Funds Management for 4.91%.
About JLL
For over 200 years, JLL (NYSE: JLL), a leading global commercial real estate and investment management company, has helped clients buy, build, occupy, manage and invest in a variety of commercial, industrial, hotel, residential and retail properties. A Fortune 500® company with annual revenue of $20.8 billion and operations in over 80 countries around the world, our more than 106,000 employees bring the power of a global platform combined with local expertise. Driven by our purpose to shape the future of real estate for a better world, we help our clients, people and communities SEE A BRIGHTER WAYSM. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit jll.com.