GIC Teams Up With Australia’s Centuria to Buy Brisbane Retail Precinct for $142M

GIC has agreed to acquire the West Village retail precinct in Brisbane with co-investor Centuria Capital Group for A$202 million ($142 million), as Singapore’s sovereign wealth fund continues to bet big on Australia ahead of the planned mid-year opening of its Sydney office.

Sydney-based fund manager Centuria announced Thursday that it would buy the retail section of West Village, an A$1.1 billion mixed-use development of Japan’s Sekisui House, “alongside an existing international sovereign wealth fund’s institutional mandate”. A report in the Australian Financial Review identified the fund as GIC.

The completed precinct will span 16,560 square metres (178,250 square feet) of modern retail facilities in addition to hospitality, wellness and office accommodation across five distinct buildings, according to Centuria, with the first of three project phases already completed.

“This was a rare, off-market opportunity to secure modern, high-quality retail real estate within such a landmark master-planned community, that will cater to approximately 1,250 households within the West Village development in addition to the surrounding West End and South Brisbane residential community,” said Bruce McCully, Centuria’s head of retail.

Phased Approach

The acquisition will be closed in three phases with the purchase of the fully occupied first phase already underway. Settlement for the second and third phases is expected between early 2022 and early 2023 as those stages of the project are completed. The partners will pay roughly A$12,198 ($8,585) per square metre for the retail precinct, which has a weighted average lease expiry of 10.1 years.

The first section of the project includes a 9,456 square metre retail mall anchored by a Woolworths supermarket, liquor store BWS and greengrocer Harris Farm. This phase also incorporates The Eaves, a three-level building combining shops with cafes, restaurants and a spa, as well as a conversion of the former Peters Ice Cream factory into specialty retail, office accommodation and parking.

The second phase, including a retail and hospitality property called South Pavilion, is to be completed in late 2022, while the third will provide further retail and hospitality outlets.

West Village occupies a 2.6 hectare (6.4 acre) site about 1 kilometre (0.6 miles) from Brisbane’s central business district. Aside from the retail precinct, the project features eight residential buildings, a 6,500 square metre office tower, 1,900 car park spaces and 6,500 square metres of public open space.

Fund Down Under

GIC, the world’s most active sovereign wealth fund, did much of its dealmaking Down Under last year with Australian investments encompassing retail, office and industrial plays.

The fund announced a big-ticket retail deal last month, joining ASX-listed SCA Property Group to launch a convenience centre vehicle targeting A$750 million ($532 million) in assets.

Also in December, GIC revealed a joint venture with Charter Hall to pick up a 12-storey office tower at 50 Marcus Clarke Street in Canberra from South Korea’s Mirae Asset Global Investments for A$335 million. That deal followed GIC’s tie-up with the fund manager in 2020, when the duo paid A$682 million for a 49 percent interest in a portfolio of convenience stores operated by Ampol, Australia’s biggest oil refiner.

In late November, Hong Kong-listed ESR’s Australia Development Partnership, which is majority-owned by GIC, agreed to buy a manufacturing site in Melbourne’s Coolaroo suburb for a reported A$45 million. Also in the Aussie industrial space, GIC forged a partnership with ESR last April to purchase the Milestone Logistics portfolio from Blackstone for A$3.8 billion.

GIC announced last May that it would open an office in Sydney this year, marking its 11th location worldwide. The fund’s website indicates plans to establish the office by mid-2022.