A recently-completed lifestyle centre in Melbourne with national retailers including Harris Scarfe, Baby Bunting, Fantastic Furniture, and Super Cheap Auto has changed hands for north of $50 million.

Joint venture partners MaxCap Group and Troon Group sold the centre, located 32km north-east of the Melbourne CBD, for $50 million on a 5.25 per cent capitalisation rate, to IOOF Investment Services.

The 11,100m2 gross lettable area large format retail centre is the latest in a number of shopping centre sales, proving the strength of bricks-and-mortar investments in the retail space, as shopping conditions continue to rebound after COVID-19.

“The development represents a highly defensive retail investment backed by long leases to national tenants with strong covenants. We’re delighted it has been acquired after a highly competitive sales campaign and are pleased to deliver further amenity into the community,” said Simon Hulett, Head of Direct Investment at MaxCap Group.

Tom McInerney, Managing Director of Troon Group, said: “We identified the site in 2020 as part of the Kaufland supermarket portfolio just as the pandemic had put us all into lockdown.

“We had a strong conviction about the quality of the site and the opportunity. The site occupies a prominent elevated position on Maroondah Highway in an established retail precinct with 38,000 cars passing daily. Through our existing relationships with the major retailers, we were able to quickly secure a mix of tenants that complement the precinct and de-risk the project with MaxCap.”

Tim McIntosh, Director of Colliers, who handled the deal said this result “reinforces the depth of buyer demand we continue to experience for bulletproof retail investments.”