Lendlease Fund and Korea’s NPS Sell Aussie Mall to Fawkner for $604M

A joint venture of a Lendlease-managed private fund and South Korea’s National Pension Service has completed the sale of a suburban Australia mall to Melbourne-based investor Fawkner Property for a record-setting A$895 million ($604 million).

The transaction for Erina Fair in New South Wales’ Central Coast region marks the largest-ever trade of sole ownership in an Australian shopping centre, according to a Tuesday announcement by CBRE and JLL, whose agents advised the sellers. Located north of Sydney in Erina, the 1987-built mall spans 114,598 square metres (1.2 million square feet) of gross leasable area and its 11 million annual visitors generate sales of A$817 million.

The landmark deal comes as domestic and offshore capital actively reallocate into Australia’s retail sector, said Simon Rooney, CBRE’s head of retail capital markets for the Pacific, as renewed conviction in the outlook, compelling risk-adjusted returns and an increasingly competitive environment drive volume.

“We continue to see a resurgence in investor confidence in the Australian retail market, with total transaction levels reaching A$12.7 billion for the year, including A$6.9 billion worth of super regional, major regional and regional centres transacting in 2025,” Rooney said.

Contents Under Pressure

With Lendlease holding 50 percent of the Erina Fair JV, the disposal notches a win for the beleaguered developer and fund manager, which has been looking to shed assets from its Australian Prime Property Fund Retail after coming under pressure from an unsuccessful bid by key investors to replace the vehicle’s management. 

NPS had acquired its half ownership in the JV holding Erina Fair from Australia’s GPT Group in 2013 for A$397.1 million.

In November, Hong Kong’s Link REIT made an unsolicited offer for half-stakes in three malls held by Lendlease’s APPF Retail with a total value of over A$1.5 billion. The target assets are 50 percent holdings in Macarthur Square in the New South Wales city of Campbelltown, Sunshine Plaza in Queensland’s Maroochydore and Lakeside Joondalup in Western Australia. The Lendlease vehicle also holds a half-stake in Westfield Carindale in Brisbane.

Erina Fair has a weighted average lease expiry of seven years among its major tenants, which include retailers Myer, Kmart, Big W, Woolworths, Coles and Aldi. The purchase equates to A$7,810 ($5,275) per square metre of gross leasable area and brings Fawkner’s total retail buys to A$3.5 billion since 2021, as the firm led by founder and chief investment officer Chris Garnaut pursues a strategy of acquiring high-quality retail shopping centres.

Fawkner previously picked up the Figtree Grove Shopping Centre in Wollongong from Singapore’s Paragon REIT and Sydney-based MA Financial Group for A$192 million in a deal completed last January.

Rush Into Retail

Australian malls and shopping centres have regained favour with offshore investors, which are now competing with local syndicators and institutional funds to acquire assets in the sector, said Nick Willis, executive director for JLL’s Australia and New Zealand retail investment team.

Aussie property giant Dexus Group last month launched a new fund seeded with a quarter-stake in Brisbane’s Westfield Chermside, the country’s second-largest regional shopping centre by both sales and gross lettable area, to be acquired for A$683 million.

The Dexus deal followed closely on fund manager Charter Hall’s A$210 million purchase of Burwood One in Melbourne’s eastern suburbs and the firm’s A$152.5 million buy of Southport Park in Queensland’s Southport.

In November, MA Financial revealed 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 — the largest-ever sale of a 100 percent interest in a Queensland regional shopping centre — built on MA’s A$393.8 million buy 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.