Adelaide-based fund manager FRP Capital has added a third Western Australian retail asset to its portfolio for $41 million.
Adelaide-based fund manager FRP Capital has added a third Western Australian retail asset to its portfolio for $41 million.
FRP Capital (formerly Red Wealth) made its debut in the WA market last year with the acquisition of the Carramar Village and Carnarvon Central shopping centres.
The group purchased Yanchep Central, plus additional development land, for $41 million: the largest shopping centre transaction in WA for calendar year 2021.
Yanchep Central was built in 2012 and is located about 50 kilometres north of the Perth CBD.
Like FRP’s other WA-based retail assets, Yanchep Central is anchored by a Woolworths. It features 16 specialty stores including a BWS, Pharmacy 777 and a McDonald’s.
The property comprises a 6,673 square metre centre as well as five hectares of development land, enabling for centre expansion, which FRP said could cater to the anticipated high population growth of the area.
FRP Capital director Ben Fusco said the asset ticked all the boxes for the company’s new Diversified Essential Services Fund.
Mr Fusco said Yanchep Central was a strong performing supermarket with a long-weighted average lease expiry, located in what he said was one of the fastest growing catchments in the country.
“There will be short-term value add opportunities that will be implemented from a leasing and management perspective; however it will be vital to take a long-term vision for the centre,” Mr Fusco said.
“In addition, the extended settlement period for the transaction enabled us to de-risk the development land from a planning and tenant perspective, adding value prior to settling on the asset.”
Jenkins Advisory managing director Lloyd Jenkins negotiated the sale on behalf of the private vendor.
The sale reflected a yield of 6.75 per cent and a rate per square metre of $4,496.
Mr Jenkins said the state and federal government housing stimulus had accelerated the population growth of Yanchep and the surrounding northern coastal corridor.
“I firmly believe that WA is now recovering well and starting to show signs of employment growth, which in turn leads to residential construction growth and demand for well-located convenience shopping centres,” he said.
Mr Jenkins also noted there had been strong demand for non-discretionary retail assets since COVID, particularly well-located neighbourhood shopping centres.
