Southlands Boulevarde in Perth and Menai Marketplace in Sydney are both facing proposed acquisitions by HomeCo Daily Needs REIT (HDN) and HMC Capital respectively for a combined price of $242.5 million.
The two Lendlease malls house 12 fashion businesses between them, including Connor, Just Jeans, Sportsgirl, Noni B, Millers and Best & Less.
HDN's proposed acquisition offer of Southlands Boulevarde is at $92.5 million, with the settlement expected to occur in February 2023.
HDN said the centre is highly productive, generating approximately $139 million of turnover per annum, with approximately 80% of income weighted to daily needs tenants.
Southlands Boulevarde is expecting to open an Aldi supermarket in the first half of 2023, joining Woolworths and Coles.
The acquisition is expected to drive HDN’s strategy to rebalance towards its 'Model Portfolio' by increasing exposure to neighbourhood and health & services tenants.
HDN CEO Sid Sharma welcomed the new acquisition to its portfolio, saying the move was strategic.
“The asset is located 12 kilometres south of the Perth CBD in an affluent metropolitan location, which further strengthens HDN’s strategic network of last mile infrastructure across greater Perth,” Sharma said.
Meanwhile, HMC Capital has secured the first seed asset for its Last Mile Logistics Fund with the proposed acquisition of Menai Marketplace for $150 million. It is expected to be settled in February 2023.
Menai Marketplace is located 30km south-east of Sydney in the Sutherland Shire and houses a Woolworths supermarket.
HMC said the asset supports a large and established trade area with attractive fundamentals including average household income which is 20% above the national average.
It also noted that the location, tenancy mix, short WALE (weighted average lease expiry) and low site coverage of 32% make the centre suitable to the LML Fund future strategy. The Fund’s aim is targeting core plus returns from repositioning well-located and strategic real estate into daily needs retailer focused infrastructure.
HMC Capital said the LML Fund is on-track for target first close equity raising of $500 million in the first half of 2023. It has recently secured $92 million of early equity commitments from Woolworths and HDN.
The LML Fund will grant HDN a right of first offer to acquire properties from the Fund which have been successfully transitioned into core daily needs assets.
HMC Capital CEO and MD David Di Pilla said the company is making progress towards its key growth initiatives through the LML Fund.
“The strong level of engagement and interest from institutional investors reinforces our high conviction in the last mile logistics strategy,” Di Pilla said.
“The LML Fund represents the first of what is expected to be a series of funds which we believe can over time grow into a multi-billion-dollar strategy.
“Importantly, this initiative will further diversify HMC Capital’s sources of capital and is consistent with our strategy to create a more sophisticated and diversified business which can thrive in both stable and volatile market environments.”