Blackstone Selling Sydney Mall to Keppel REIT, MA Financial for $345M

Private equity titan Blackstone has agreed to sell a suburban Sydney mall to Singapore-listed Keppel REIT and Australia’s MA Financial Group for A$525 million ($344.6 million).

The REIT sponsored by Temasek-backed Keppel Ltd is acquiring its 75 percent interest in Top Ryde City Shopping Centre for A$393.8 million as its first pure-play retail asset, the trust’s manager said Wednesday in a release. Sydney-based MA will buy the remaining 25 percent stake and serve as the asset manager and property manager of the 2010-built mall in Ryde.

“The diversification allows Keppel REIT to benefit from enhanced portfolio resilience as Australian retail malls offer attractive yields, with suburban retail assets demonstrating resilience and strong growth potential supported by long-term consumption growth and population increase,” said Chua Hsien Yang, CEO of the manager.

Manhattan-based Blackstone had bought the mall developed by tycoon John Beville out of receivership in late 2012 and revived it by adding anchor retailers including Coles supermarket and discounter Kmart, according to an account in The Australian, which first reported on the pending transaction last month. Blackstone didn’t respond to Mingtiandi’s request for comment.

Defensive Play

Situated at the corner of Devlin Street and Blaxland Road, 14 kilometres (8.7 miles) northwest of central Sydney, Top Ryde City comprises 77,054 square metres (829,402 square feet) of lettable area and 2,739 parking spaces. Committed occupancy is 96 percent with a weighted average lease expiry of 4.2 years by committed gross rent.

As part of a mixed-use development with 653 residential units, the mall serves an affluent, family-based catchment with a population of 477,000 and generates A$487 million in annual sales, according to JLL, which advised Blackstone on the disposal.

“Major institutional capital is increasingly looking to re-weight back towards the retail sector in Australia, driven by the strong fundamentals and consistent performance of the sector globally,” said Sam Hatcher, JLL’s head of retail investments for Australia and New Zealand.

Keppel REIT and MA are picking up Top Ryde City at a price translating to A$6,813 ($4,469) per square metre of lettable area and a fully leased initial property yield of 6.7 percent.

The Singaporean trust is funding the buy through debt, equity and perpetual securities, including a S$113 million ($87.3 million) private placement, while MA is making its investment on behalf of a managed fund. The transaction is expected to close by the first quarter of 2026.

“We are excited to partner with Keppel REIT to acquire Top Ryde City Shopping Centre on very attractive terms on behalf of our valued stable of investors,” said Chris Lock, head of core real estate at MA Financial. “The social infrastructure characteristics of the shopping centre provides a defensive foundation for investor returns at a point of time that we believe the tailwinds for the real estate cycle are very favourable.”

Retail Wave

The latest wave of large mall deals Down Under kicked off during the first quarter of the year when US property giant Hines and Australian fund manager Haben acquired Sydney’s Westpoint Shopping Centre from the Queensland Investment Corporation for A$900 million.

The sale of Westpoint represented the biggest-ever single transaction of an Australian retail asset, according to Colliers, which represented QIC in the sale.

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.