Retail SPECIAL REPORT Retail

FEATURE

Retailers seek an edge in battle back from closure

EXPANSION: Post-redevelopment, Karrinyup Shopping Centre will become the state’s second largest centre. Photo: Gabriel Oliveira The pandemic has accelerated existing issues and trends facing the retail property sector.

potentially bolstered by the and , the operator The commercial property 500 or so people returning to of Westfield, both posting huge research firm’s latest study WA each week. financial losses. % found nearly one in 10 stores “Someone described the WA reported a across WA’s largest supermar- lockdown as a product recall net loss of $1.8 billion for the 9.4 ket-based shopping centres was VACANCY RATE for people, which I thought 12 months to June 30, as well vacant. was a very apt way of describ - as $264 million worth of write- ACROSS WA’S LARGEST Mr Stone said that was due ing it,” Mr Cresp told Business downs across its 12 WA assets. SUPERMARKET-BASED to a range of existing factors News. Similarly, Scentre Group CENTRES including: weak economic con- “WA has highlighted [that] reported a half-year loss of $3.6 ditions after the mining boom; a Katie McDonald once people are out of lock- billion, following a $4.1 billion tenant bases from straight series of national retailers going [email protected] down, they are going shopping write-down of its properties retail to hospitality and enter- into administration; and recent 8-PAGE FEATURE and using a centre as a day out. across Australia. tainment, he said. shopping centre expansions “Retail is not going away. Although the group does “Significant investment by adding supply. HE state’s retail sector There will be some shifts and not provide a centre-by-cen- proactive landlords in WA has While a limited number of is showing signs of life acceleration of trends that have tre breakdown, its WA centres helped them obtain a strong retailers had surrendered their T after lockdown, with been happening for a long time, reported one of the lowest rates position within the retail tenancies in recent months spending up and anecdotal [such as] online sales … the push of specialty in-store sales losses sector,” Mr Ibrahimi told Busi- – largely tourism-based retail- reports that foot traffic at to mixed use. over the past six months. ness News. ers such as travel agents shopping centres is nearing pre- “But it’s still a core funda- Colliers International head “This strong rebound demon- – Mr Stone said the pandemic’s COVID-19 levels. mental sector of the property of WA leasing Ahmad Ibrahimi strates the accomplishments of longer-term influence was yet Retail expenditure growth market and there’s a huge said while economic uncer- the retail sector in cementing to materialise. in of 4.9 amount of institutional funds tainty and volatility remained, its role in the WA economy.” “For a majority of retailers, per cent for the 12 months to in retail.” the state had been a leader in a combination of rental relief June 2020 was second only to Some of those funds are managing COVID-19. Vacancies from shopping centre owners, Queensland (see graph). starting to feel the flow-on- Being able to reopen earlier COVID-19 has, so far, had min- a national code of conduct Urbis director, property eco- effects of enforced shutdown than most states had helped the imal impact on WA’s shopping restricting evictions, and gov- nomics and market research measures, however, with the sector reset faster, backed by centre vacancies, according to ernment assistance (JobKeeper) David Cresp said the state had country’s major shopping centre upgrades over the past Y Research director Damian has seen them return to trad- resumed a sense of normality, centre owners, Vicinity Centres five years that had diversified Stone. ing,” he said.

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PB | | PB FEATURE

“It looks normal from the was another emerging trend Retail outside, but [after] a closer look Mr Stone said shopping centre Kardinya Shopping Centre you’ll see a lot of these retailers owners would have to navigate Image: Hames Sharley are struggling. in the coming months. “The interesting discussion is In May, Target announced FEATURE the number of sales and ‘back the closure of 75 outlets and in five minutes’ signs, because the conversion of 92 into Kmart they’ve cut staff.” stores. Mr Stone said he had person- This followed the closure ally inspected 78 of the state’s of hundreds of other stores 10 – Annual Growth in Retail Turnover (Current prices) largest supermarket-based associated with the collapse centres across the broader of national chains including 8 – metropolitan region, and Australian Geographic, jewel- recorded a 9.4 per cent collective ler Michael Hill, and accessory vacancy rate as at June 2020. store Colette. 6 – The Y Research report found Mosaic Brands – the opera- the vacancy rate for WA’s major tor of clothing chains Noni B, % 4 – regional centres, including Rivers, Millers and Katie – is Lakeside Joondalup, Westfield retail’s latest casualty, announc- Booragoon and Galleria, was 7.4 ing the potential closure of 2 – per cent, which was more than 300-500 stores over the coming three times higher than their 12-24 months. 0 – historical average of 1 to 2 per Mr Stone said more con - cent. solidation could follow, with Aust NSW Qld Vic WA Claremont Quarter recorded COVID-19 prompting national -2 – 2014 2015 2016 2017 2018 2019 2020 the lowest vacancy rate of any retailers to assess their most Source: Urbis, ABS 8501.0 Retail Turnover centre at 1.7 per cent. profitable stores and locations Retailers seek an edge in Mr Stone said there was a with the most foot traffic. wide disparity across centres, “If national chains aren’t likely reflecting the economic expanding and franchises aren’t conditions across Perth’s sub- expanding, who‘s going to fill battle back from closure urbs; 21 suburban centres had those vacancies?” he asked. vacancy rates of more than 15 EXPANSION: Post-redevelopment, Karrinyup Shopping Centre will become the state’s second largest centre. Photo: Gabriel Oliveira per cent and five centres were Future more than 25 per cent empty. Re-imagined entertainment That number could increase precincts have been the jewel in The pandemic has accelerated existing issues and further, he said, with the mora- the crown for shopping centre torium on evictions set to finish expansions such as Westfield trends facing the retail property sector. in October. Carousel and Westfield Whitford Source: Y Research potentially bolstered by the and Scentre Group, the operator The commercial property “At the end of the day, that million redevelopment of or meet friends for a meal 500 or so people returning to of Westfield, both posting huge research firm’s latest study [the experience] is the dif - (to be after work. For that reason, WA each week. financial losses. % found nearly one in 10 stores This strong rebound ference between going to a renamed Westfield Stirling) we are actively curating “Someone described the WA Vicinity Centres reported a across WA’s largest supermar- shopping centre or buying last year, however, those plans retail, hospitality, wellness lockdown as a product recall net loss of $1.8 billion for the 9.4 ket-based shopping centres was demonstrates the accomplishments something online. were put on hold after Scentre and fitness operators for our VACANCY RATE for people, which I thought 12 months to June 30, as well ACROSS WA’S LARGEST vacant. “Some of those centres, Group announced it had pur - developments, before we start was a very apt way of describ - as $264 million worth of write- Mr Stone said that was due of the retail sector in cementing its there’s a recognition it’s gotten chased a 50 per cent stake in selling apartments or finalis- ing it,” Mr Cresp told Business downs across its 12 WA assets. SUPERMARKET-BASED to a range of existing factors as large as the catchment area … Booragoon shopping centre, ing designs. News. Similarly, Scentre Group CENTRES including: weak economic con- role in the WA economy - Ahmad Ibrahimi now it’s a matter of making the joining AMP Capital as joint “We then create customised “WA has highlighted [that] reported a half-year loss of $3.6 ditions after the mining boom; a land work harder.” owner. spaces for these operators that Katie McDonald once people are out of lock- billion, following a $4.1 billion tenant bases from straight series of national retailers going “Based on discussions with City in recent years, but health Medical was part of that Meanwhile, several other work, rather than trying to ret- [email protected] down, they are going shopping write-down of its properties retail to hospitality and enter- into administration; and recent industry stakeholders, the and wellness is quickly becom- mix, Mr Cresp said, as well as suburban centres are in line for rospectively jam tenants into 8-PAGE FEATURE and using a centre as a day out. across Australia. tainment, he said. shopping centre expansions expectation is that, across the ing the next focus. accommodation, whether that facelifts. pre-designed spaces.” “Retail is not going away. Although the group does “Significant investment by adding supply. balance of 2020, we will see According to an Urbis study, was short-stay, apartments or Property investment and Meanwhile, Con Berbatis HE state’s retail sector There will be some shifts and not provide a centre-by-cen- proactive landlords in WA has While a limited number of a limited number of retailers patrons who visited a medical retirement living. As an exam- development group Austral- is planning an $80 million is showing signs of life acceleration of trends that have tre breakdown, its WA centres helped them obtain a strong retailers had surrendered their close,” Mr Stone said. centre were found to spend a ple, he pointed to Blackburne, ian Development Capital has upgrade of Kardinya Park Shop- T after lockdown, with been happening for a long time, reported one of the lowest rates position within the retail tenancies in recent months “But the new looming cliff higher amount on apparel than which planned 94 apartments plans to revamp its Mosman ping Centre. spending up and anecdotal [such as] online sales … the push of specialty in-store sales losses sector,” Mr Ibrahimi told Busi- – largely tourism-based retail- is February-March 2021, when those who didn’t. as part of the $800 million Heights Shopping Centre, built Built has been appointed to reports that foot traffic at to mixed use. over the past six months. ness News. ers such as travel agents government assistance ends Whatever the cause of that Karrinyup Shopping Centre in the 1970s, with more details carry out the works, and project shopping centres is nearing pre- “But it’s still a core funda- Colliers International head “This strong rebound demon- – Mr Stone said the pandemic’s and investment decisions, such behaviour, Mr Cresp said centre redevelopment. to be announced in the coming spokesperson Clint Ford said COVID-19 levels. mental sector of the property of WA leasing Ahmad Ibrahimi strates the accomplishments of longer-term influence was yet as ordering winter stock, are owners were keen to harness Works on that expansion weeks. the redevelopment included Retail expenditure growth market and there’s a huge said while economic uncer- the retail sector in cementing to materialise. required.” opportunities in the health and are under way, and will almost “People want bustling, busy plans for an entertainment pre- in Western Australia of 4.9 amount of institutional funds tainty and volatility remained, its role in the WA economy.” “For a majority of retailers, The internet had been an wellness space, a market that double Karrinyup’s footprint to and activated spaces on their cinct, and health and wellness per cent for the 12 months to in retail.” the state had been a leader in a combination of rental relief emerging challenge, he said, and had also been growing in terms 109,000 square metres, overtak- doorstep,” ADC_ executive offerings. June 2020 was second only to Some of those funds are managing COVID-19. Vacancies from shopping centre owners, COVID-19 had exacerbated the of household expenditure and ing Lakeside Joondalup as the director Adam Zorzi told Busi- “Kardinya is looking to be Queensland (see graph). starting to feel the flow-on- Being able to reopen earlier COVID-19 has, so far, had min- a national code of conduct threat from online sales. had demonstrated resilience state’s second largest centre, ness News. a leader in the town centre

Urbis director, property eco- effects of enforced shutdown than most states had helped the imal impact on WA’s shopping restricting evictions, and gov- The consolidation of a during the pandemic. according to Data & Insights “Places that draw in the model,” Mr Ford said. nomics and market research measures, however, with the sector reset faster, backed by centre vacancies, according to ernment assistance (JobKeeper) number of national chains, “If anything, this (COVID) has (see page 29). surrounding community and “It is clear that an offer of

David Cresp said the state had country’s major shopping centre upgrades over the past Y Research director Damian has seen them return to trad- which typically took out the accelerated that trend to mixed Construction was set to where they can grab a morn - mixed amenity … will ensure resumed a sense of normality, centre owners, Vicinity Centres five years that had diversified Stone. ing,” he said. largest tenancies in centres, use,” he said. start on the planned $830 ing coffee, take a fitness class sustainability of retail centres.”

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PB | | PB FEATURE RETAIL Wake-up call for CBD retail

DRAWCARD: The redevelopment of includes a mix of entertainment offerings. Image: Hames Sharley

It will take a mix of planning, marketing and property redevelopment initiatives to resuscitate Perth’s ailing CBD retail market.

Katie McDonald whole; however, the whole for the brand, marketing, place, com- [email protected] last decade has remained largely munications and leasing, among In retail terms, the tenancy mix undefined.” others. VACANT shopfronts and ‘for Ms Dempster said one of the “Retail requires an integrated is the product and the built form is the lease’ signs have become a famil- biggest challenges facing the approach,” Ms Dempster said. iar sight along the city’s retail CBD, besides the shrinking office “There are incredible entre- packaging - Kristi Dempster strips in recent years, but Kristi cohort, which formed a main preneurs, designers, architects, Dempster says a coordinated source of city foot traffic, was a restaurateurs and hoteliers in this “In light of the upcoming [coun- impending $200 million Carillon approach could turn that around lack of a clearly defined destina- city; we have all the answers, it’s cil] election, the core question has City redevelopment. and provide a much-needed tion brand for Perth city, and a all in how we frame it.” to be: how do we bring people Carillon owner Dexus unveiled wake-up call. strategy to support it. Fragmented ownership was back into the city? plans last year, proposing a 24-level The managing director of In recent years, Assembly + another challenge facing the “What’s the compelling reason mixed-use development featuring Assembly + Co, a marketing firm Co worked with Mirvac to repo- CBD retail market, according to Y for people to shop, live and work a renewed retail precinct, com- that specialises in retail pre - sition Allendale Square, as well Research director Damian Stone. in the city?” plete with tavern, bowling alley cincts and destination projects, as Sirona Capital’s Kings Square Mr Stone said there were more and a tertiary education floor. says she’s watched the city evolve Fremantle retail offering, FOMO, than 100 landlords in the city, all Investment A start date is yet to be deter- and reinvent itself over the past which is expected to open in 2021. with different budgets, priorities, A series of property projects mined for the project, with Dexus 20 years, first as a student and “In retail terms, the tenancy and financial capabilities. could help to provide those draw- flagging the project as uncommit- now from an office in Trinity mix is the product and the built “The collective marketing that cards, including the $12 million ted in its FY20 results. Arcade. form is the packaging,” Ms Demp- a Garden City or a Lakeside can facelift of the Piccadilly Arcade A Dexus spokesperson told “For a period of my life I could ster said. do … in the CBD it’s one versus on Hay Street Mall, which is Business News the company was have recited the tenancy mix on It was then up to marketing the 100 or so other owners,” he under construction and expected still in the master-planning phase every street that made up Perth’s and communications, she said, said. to reopen as a live performance for Carillon. CBD,” Ms Dempster told Business to employ a multi-platform Mr Stone estimated there were venue with renewed retail fitouts. “Uncommitted means that this News. approach to engage with user more than 20 vacancies along the Piccadilly’s closure in 2013 left project is still in the proposal “I just genuinely loved the groups. Hay and Murray Street malls. the city without a cinema until phase and further commercial sense of discovery, the unearthing Ms Dempster said establishing “Consumers are spoilt for Palace Cinemas opened in 2013 arrangements need to be finalised of a CBD secret, the energy of the shared priorities across stake- choice,” he said. as part of the $500 million Raine before such plans progress,” the city, its grit and graffiti. holder groups and sectors was “We’ve got 78 major shopping Square redevelopment. spokesperson said. “The city is full of sub precincts. one immediate approach the city centres, and major retail strips More cinema screens are “Once completed, Carillon will It comprises neighbourhoods could take, as was assembling a down Albany Highway, Cottesloe, expected to hit the CBD, with reposition the city centre into a with their own unique built form, retail task force that integrated Bay View Terrace ... there are a Hoyts announcing its intention vibrant retail, dining and enter- public space and tenancy mix. key stakeholders and disciplines: multitude of options, before you to move back to the city after tainment destination in the heart All parts must contribute to the landlords, architects, designers, even talk about online. a 30-year hiatus as part of the of the CBD.” 24 | | PB

PB | | PB FEATURE RETAIL Wake-up call for CBD retail

DRAWCARD: The redevelopment of Carillon City includes a mix of entertainment offerings. Image: Hames Sharley

It will take a mix of planning, marketing and property redevelopment initiatives to resuscitate Perth’s ailing CBD retail market.

Katie McDonald whole; however, the whole for the brand, marketing, place, com- [email protected] last decade has remained largely munications and leasing, among In retail terms, the tenancy mix undefined.” others. VACANT shopfronts and ‘for Ms Dempster said one of the “Retail requires an integrated is the product and the built form is the lease’ signs have become a famil- biggest challenges facing the approach,” Ms Dempster said. iar sight along the city’s retail CBD, besides the shrinking office “There are incredible entre- packaging - Kristi Dempster strips in recent years, but Kristi cohort, which formed a main preneurs, designers, architects, Dempster says a coordinated source of city foot traffic, was a restaurateurs and hoteliers in this “In light of the upcoming [coun- impending $200 million Carillon approach could turn that around lack of a clearly defined destina- city; we have all the answers, it’s cil] election, the core question has City redevelopment. and provide a much-needed tion brand for Perth city, and a all in how we frame it.” to be: how do we bring people Carillon owner Dexus unveiled wake-up call. strategy to support it. Fragmented ownership was back into the city? plans last year, proposing a 24-level The managing director of In recent years, Assembly + another challenge facing the “What’s the compelling reason mixed-use development featuring Assembly + Co, a marketing firm Co worked with Mirvac to repo- CBD retail market, according to Y for people to shop, live and work a renewed retail precinct, com- that specialises in retail pre - sition Allendale Square, as well Research director Damian Stone. in the city?” plete with tavern, bowling alley cincts and destination projects, as Sirona Capital’s Kings Square Mr Stone said there were more and a tertiary education floor. says she’s watched the city evolve Fremantle retail offering, FOMO, than 100 landlords in the city, all Investment A start date is yet to be deter- and reinvent itself over the past which is expected to open in 2021. with different budgets, priorities, A series of property projects mined for the project, with Dexus 20 years, first as a student and “In retail terms, the tenancy and financial capabilities. could help to provide those draw- flagging the project as uncommit- now from an office in Trinity mix is the product and the built “The collective marketing that cards, including the $12 million ted in its FY20 results. Arcade. form is the packaging,” Ms Demp- a Garden City or a Lakeside can facelift of the Piccadilly Arcade A Dexus spokesperson told “For a period of my life I could ster said. do … in the CBD it’s one versus on Hay Street Mall, which is Business News the company was have recited the tenancy mix on It was then up to marketing the 100 or so other owners,” he under construction and expected still in the master-planning phase every street that made up Perth’s and communications, she said, said. to reopen as a live performance for Carillon. CBD,” Ms Dempster told Business to employ a multi-platform Mr Stone estimated there were venue with renewed retail fitouts. “Uncommitted means that this News. approach to engage with user more than 20 vacancies along the Piccadilly’s closure in 2013 left project is still in the proposal “I just genuinely loved the groups. Hay and Murray Street malls. the city without a cinema until phase and further commercial sense of discovery, the unearthing Ms Dempster said establishing “Consumers are spoilt for Palace Cinemas opened in 2013 arrangements need to be finalised of a CBD secret, the energy of the shared priorities across stake- choice,” he said. as part of the $500 million Raine before such plans progress,” the city, its grit and graffiti. holder groups and sectors was “We’ve got 78 major shopping Square redevelopment. spokesperson said. “The city is full of sub precincts. one immediate approach the city centres, and major retail strips More cinema screens are “Once completed, Carillon will It comprises neighbourhoods could take, as was assembling a down Albany Highway, Cottesloe, expected to hit the CBD, with reposition the city centre into a with their own unique built form, retail task force that integrated Bay View Terrace ... there are a Hoyts announcing its intention vibrant retail, dining and enter- public space and tenancy mix. key stakeholders and disciplines: multitude of options, before you to move back to the city after tainment destination in the heart All parts must contribute to the landlords, architects, designers, even talk about online. a 30-year hiatus as part of the of the CBD.” 24 | | PB

PB | | PB FEATURE RETAIL

SECURITY: Anthony Del Borrello says interest in neighbourhood retail centres has remained buoyant, as investors shift their focus to more risk-averse opportunities. Investors make strategic retail play Certain pockets of the retail market have proved their value during the pandemic, and investors are taking notice.

Katie McDonald on Carramar Village represent- larger percentage of purchaser [email protected] ing the largest 2020 transaction. demand for neighbourhood Transaction activity in WA this It’s a trend playing out nation- centres due to their conven - INVESTOR appetite for Western ally, with neighbourhood centres ience-based nature, secure year has been mainly focused on those Australia’s smaller neighbour- accounting for one third of total covenants and long-term leases, hood shopping centres appears retail transactions in the first typically anchored by tenants core non-discretionary assets that have undiminished, despite the sour half of 2020, compared to just 16 with minimal exposure to dis - taste COVID-19 has left in other per cent in 2019. cretionary spending. lower occupancy risk - Anthony Del Borrello parts of the retail market. CBRE manager WA retail “Transaction activity in Recent end-of-financial- investments Anthony Del WA this year has been mainly from a range of groups, particu- improvement, entertainment year reporting to the ASX by Borrello said that movement focused on those core non-dis- larly syndicate investors.” and furniture spending. some major shopping centres was also reflected in WA, with cretionary assets that have lower Large-format retail is another CBRE’s preliminary retail demonstrates the effects of the neighbourhood centre sales occupancy risk, such as super- market sector to have demon- trade figures for May 2020 found lockdown measures, with ASX- accounting for $110 million of markets, pharmacies, hardware strated resilience during the past household goods were retailing listed groups including Vicinity the $145 million worth of sales and, to a slightly lesser extent, few months. up 30 per cent year-on-year. Centres and Westfield operator this year (see table). service stations,” he said. At the peak of shutdown, “Some aspects of retail are Scentre Group posting losses and “The fact the demand hasn’t “In contrast, prior to the cur - WA-based investor Lester Group struggling; I’m not saying it’s all asset write-downs. decreased for these types of rent downturn, investor demand spent $58 million on the five-hec- sunshine and roses,” he said. In comparison, retail’s smaller assets, during what is quite a tur- gravitated toward slightly larger tare Midland Megaplex precinct, “But there are certain sectors asset class has emerged as bulent time globally and locally, centres that offered diversity of tenanted by Spudshed, Fantastic of retail that are definitely hold- a front-runner for investor speaks for itself,” Mr Del Borrello income and rental growth. Now, Furniture and Spotlight, among ing up.” dollars. told Business News. however, that diversity contains others, with the sale brokered by For the calendar year to date, “There are a lot of groups more risk. Colliers International. Opportunity sales of WA neighbourhood moving towards secure “Non-discretionary-based assets Mr Del Borrello said the recent South Australia-based syndi- shopping centres have already investments.” are being recognised as strategic federal and state government cate FRP Capital (formerly Red surpassed the levels recorded in Mr Del Borrello said that had and relatively secure investments, housing stimulus packages had Wealth) has been active in the 2019, with the $33.5-million move translated to driving a much which is driving buyer interest prompted an uptick in home market recently. 26 | FEATURE RETAIL RETAIL FEATURE

This year the group bought WA retail two WA properties: Carramar $ Village and Carnarvon Central, sales YTD m both of which are anchored by a 10 + Woolworths. Property Date Sale Price Yield Buyer type FRP managing director Adrian Rivish said the company had Midland Megaplex Apr $58.0m 6.50% Syndicator exited WA’s residential property market about 10 years ago, and Carramar Village Jul $33.5m 6.20% Syndicator had since observed the boom and correction cycle, the state’s Woolworths Greenfields Jan $32.0m 5.74% Syndicator rebounding economy, and con- nections to Asia reigniting an Carnarvon Central Jan $16.1m 7.89% Syndicator interest in west coast property. Carramar Village Part of the group’s rebrand and Neighbourhood centre share of total new direction, he said, was the launch of its Non-Discretionary transaction volumes Australia Retail Fund, aiming to target six 300 – to eight assets with total value of between $180 million and $220 million across Australia. Mr Rivish said the Carnarvon 200 – and Carramar assets formed part of this fund, with plans to add more to the portfolio

(but with stringent hallmarks, $million 100 – including those assets with large ASX-listed tenants such as Woolworths). “We like neighbourhood shop- ping centres,” he said. 0 – 2015 2016 2017 2018 2019 2020YTD SECURITY: Anthony Del Borrello says interest in neighbourhood retail centres has remained buoyant, as investors shift their focus to more risk-averse opportunities. “Defensive, recession-proof assets backed by strong-per - forming anchor tenants, strong Total Neighbourhood centre transaction distributions to our investors, volumes WA Carnarvon Central and medium to long-term buy- 0.6 – Investors make strategic retail play and-hold assets. “[At] Carnarvon and Carramar, local community groups, forming Trust No 1, which recently more than 50 per cent of the over- early plans for an indigenous art secured more than 3,300 square Certain pockets of the retail market have proved their value during the pandemic, all income is from anchor tenants.” mural, and creating a space to cel- metres of new leases and rene - and investors are taking notice. Mr Rivish said retail gener - 0.4 – ebrate local produce. gotiated an extension of leases ally had copped some negativity, “My personal opinion … if an within its portfolio. due to the evolving landscape of online retailer wants to be suc- Assets include a collection of % Katie McDonald on Carramar Village represent- larger percentage of purchaser online shopping. cessful, they’ve got to be able to large-format retail properties [email protected] ing the largest 2020 transaction. demand for neighbourhood Transaction activity in WA this “Even though they [neighbour- 0.2 – deliver the goods in a reasonable in Malaga housing a mix of 20 It’s a trend playing out nation- centres due to their conven - hood centres] fall within that time frame,” he said. tenants. INVESTOR appetite for Western ally, with neighbourhood centres ience-based nature, secure year has been mainly focused on those ‘retail’ market, they’re tainted … “If I was an online retailer, “In the large-format retail Australia’s smaller neighbour- accounting for one third of total covenants and long-term leases, by that negative brushstroke,” he I’d like to have access to all the sector what we have seen par - hood shopping centres appears retail transactions in the first typically anchored by tenants core non-discretionary assets that have said. 0 – major cities and routes to deliver ticularly during the COVID undiminished, despite the sour half of 2020, compared to just 16 with minimal exposure to dis - “The negative sentiment 2012 2013 2014 2015 2016 2017 2018 2019 2020YTD the goods in a timely manner. period, and what we’re hearing taste COVID-19 has left in other per cent in 2019. cretionary spending. lower occupancy risk - Anthony Del Borrello surrounding the retail market Source: CBRE “Just because we walk in today from our tenants, is click and parts of the retail market. CBRE manager WA retail “Transaction activity in will provide some buying doesn’t mean we walk in tomor- collect was pretty popular,” Mr Recent end-of-financial- investments Anthony Del WA this year has been mainly from a range of groups, particu- improvement, entertainment opportunities.” period as people are travelling row, but tenants need space to Fogliani told Business News. year reporting to the ASX by Borrello said that movement focused on those core non-dis- larly syndicate investors.” and furniture spending. That opportunity, Mr Rivish more throughout WA.” $ hold their goods. “The retailers like that; there’s some major shopping centres was also reflected in WA, with cretionary assets that have lower Large-format retail is another CBRE’s preliminary retail said, was potentially more boun- Mr Rivish said the rise of “Retail is changing, it’s about a greater chance of those people demonstrates the effects of the neighbourhood centre sales occupancy risk, such as super- market sector to have demon- trade figures for May 2020 found tiful in WA. e-commerce wasn’t so much a m how it’s going to change and how coming in to pick up what they lockdown measures, with ASX- accounting for $110 million of markets, pharmacies, hardware strated resilience during the past household goods were retailing “The east coast market is far threat to neighbourhood centres, LESTER58 GROUP we are going to place ourselves to ordered … to pick up a few more listed groups including Vicinity the $145 million worth of sales and, to a slightly lesser extent, few months. up 30 per cent year-on-year. more competitive than WA, but more a prompt for a rethink. SPEND ON MIDLAND still be able to offer solutions for things on their way out. Centres and Westfield operator this year (see table). service stations,” he said. At the peak of shutdown, “Some aspects of retail are therefore the yields are not as Convenience, community and these retailers.” “If anything, the online and Scentre Group posting losses and “The fact the demand hasn’t “In contrast, prior to the cur - WA-based investor Lester Group struggling; I’m not saying it’s all attractive,” he said. services (such as fitness, health MEGAPLEX PRECINCT That divergence of the online click and collect is probably asset write-downs. decreased for these types of rent downturn, investor demand spent $58 million on the five-hec- sunshine and roses,” he said. “Carnarvon Central was a and beauty-related services), and in-store worlds is a future making it easier for shopping. In comparison, retail’s smaller assets, during what is quite a tur- gravitated toward slightly larger tare Midland Megaplex precinct, “But there are certain sectors yield play; over an eight per cent he said, were the three funda - things that we just can’t do or that’s also starting to become “So the stores still appear to asset class has emerged as bulent time globally and locally, centres that offered diversity of tenanted by Spudshed, Fantastic of retail that are definitely hold- return with strong investment mentals that would continue to prefer to do in person,” Mr Rivish apparent to Quadrant Invest- have a place; there’s the conven- a front-runner for investor speaks for itself,” Mr Del Borrello income and rental growth. Now, Furniture and Spotlight, among ing up.” fundamentals [such as] long underpin relevancy and drive said. ments co-owner and chief ience of picking it up from your dollars. told Business News. however, that diversity contains others, with the sale brokered by weighted average lease expiry, future demand for neighbour- He said ongoing value-adding investments officer, Phillip local store on your way home For the calendar year to date, “There are a lot of groups more risk. Colliers International. Opportunity dominant anchor tenant, limited hood centres. exercises formed a key part of Fogliani. rather than waiting for it to be sales of WA neighbourhood moving towards secure “Non-discretionary-based assets Mr Del Borrello said the recent South Australia-based syndi- competition in the catchment, “We believe the local centre FRP Capital’s strategy. Quadrant Investments was delivered. shopping centres have already investments.” are being recognised as strategic federal and state government cate FRP Capital (formerly Red and a strategic location. isn’t going anywhere; it’s con- Mr Rivish said he had already launched in 2017 and is anticipat- “And there’s still a weight of surpassed the levels recorded in Mr Del Borrello said that had and relatively secure investments, housing stimulus packages had Wealth) has been active in the “We have also seen an increase venient, it’s a place for people started work on the group’s Car- ing growth in asset valuations money out there that’s looking 2019, with the $33.5-million move translated to driving a much which is driving buyer interest prompted an uptick in home market recently. in turnover during the COVID to meet, and there are certain narvon asset, connecting with within its Large Format Retail for a place to invest.” 26 | | 27 FEATURE RETAIL

Data & Insights WA’s LARGEST SHOPPING CENTRE OWNERS Ranked by size of total area (in metres squared)

Senior executive and No. of WA

Rank from e Chang year previous Company name title Size of Total Area in m2 centres WA Shopping centre name and size

Galleria 50% (40,685), Ellenbrook Central (47,748), Warwick Grove (32,250), Rockingham Shopping Centre 50% (31,110), 1 — Vicinity Centres Mr Grant Kelley 284,492 12 Maddington Central (27,837), Karratha City 50% (11,740), Dianella Plaza (17,161), Mandurah Forum 50% (33,008), Managing director Livingston Marketplace (15,601), DFO Perth 50% (11,917), Victoria Park Central (5778), Halls Head Central 50% (9657) Primewest Albany Central (10,328), Primewest Busselton Home Depot (22,992), Primewest Melville (20,300), Bunbury 2 — Primewest Mr John Bond 243,423 19 Centrepoint (16,813), Cottesloe Central (12,495), Southern River Shopping Centre & Showrooms (12,209), Primewest Co-founder, executive chair Northlands (8,258), Primewest Osborne Park (14,625), Primewest Gosnells (7,965), Primewest Gwelup (5,143)… Mr Chris Barton 3  Scentre Group Regional manager, WA 236,437 4 (110,000), 50% (42,547), Westfield Innaloo (47,780), Westfield & SA Booragoon 50% (36,110) Mr Ross Robertson The Square Mirrabooka (41,816), Cockburn Gateway (49,817), Belmont Forum (47,680), Galleria Shopping Centre 4  Perron Group Managing director 179,998 4 50% (40,685) (42,005), Mandurah Forum 50% (32,000), Enex 100 (8,294), Brighton Village Shopping Centre 5 — ISPT Mr Daryl Browning 135,282 8 (4,622), Halls Head Central 50% (9,657), Banksia Grove Village (8,626), Beeliar Village (8,908), Lakelands Chief executive Shopping Centre (21,170) Mr Chris Learmonth 6 — Lendlease Group General manager, building, 119,350 4 Lakeside Joondalup Shopping City 50% (49,870), Armadale Shopping City (31,916), Southlands Boulevard WA (21,621), Northgate Shopping Centre (15,943) Ms Karen Draper 7 — AMP Capital Asset Manager, WA 104,476 3 50% (36,110), Shopping Centre (37,216), 50% (31,150)

Mr Anthony Mellowes Busselton Shopping Centre (5,432), Kwinana Marketplace (32,935), Treendale (7388), Currambine Central 8  SCA Property Group Chief executive 99,017 7 (17,031), Kalamunda (8,352), Stirlings Central (8,446), Warnbro (21,433) Mr Miles Rowe 9  Charter Hall Regional portfolio 95,390 7 Wanneroo Central (20,536), Albany Plaza Shopping Centre (17,840), South Hedland Square (16,819), Kalgoorlie manager, WA Plaza (9,011), Esperance Boulevard (7,596), Secret Harbour Square (19,714), Swan View Shopping Centre (3,874) Claremont Quarter 50% (15,093), Hawaiian's Forrestfield (13,200), Hawaiian's Noranda (11,737), Hawaiian's Bassendean (9,541), 10 — Hawaiian Mr Russell Gibbs 94,837 10 The Mezz (6,670), The Park Centre (approx 14,200), Duncraig Shopping Centre (3,353), Newpark Shopping Centre (10,001), Chief executive Hawaiian's Melville (8,964), Darling Ridge Shopping Centre (2,349) Floreat Forum Shopping Centre (19,000), West Leederville Shopping Centre (5,422), Kinross Central Shopping 11  APIL Group Mr Peter Hughes 77,788 9 Centre (5,500), Champion Drive Shopping Centre (4,700), Ballajura Central (4,680), Carine Glades Shopping Managing director Centre (3,053), Joondalup Gate (24,533), Byford Market Place (5,000), Flinders Square (5,900) Ms Karen Noad 12  Stockland Regional retail manager 76,537 4 Stockland Baldivis (34,515), Riverton 50% (9,885), Bull Creek (16,897), Harrisdale (15,240)

Mr Kevin O'Sullivan 13 — UniSuper Chief executive 59,874 1 Karrinyup Shopping Centre (59,874) Parks Centre (10,621), Springs Shopping Centre (8,672), Cale House Midland (4,049), 2nd Avenue Plaza (1,972), 14 — Erceg Management Mr Allan Erceg 40,107 6 Lakes Shopping Centre (9,238), Alexander Heights Shopping Centre (11,872), Power Centre (9,712) plus Managing director 3,200sqm under construction.

15 — GPA and CGB 29,516 3 Waterford Plaza (14,000), Kardinya Park (13,600), Plaza Arcade (2,598)

Mr Raymond Tan 16 — Tah Land Director 24,200 1 Kingsway City Shopping Centre (24,200)

Mr Rohan Mead 17 — Australian Unity Managing director 23,596 3 Busselton Central Shopping Centre (9,062), Dog Swamp Shopping Centre (8,156), Woodvale Boulevard (6,378) 18 Data & Insights GET THE FULL LIST ONLINE businessnews.com.au/bniq/shopping-centre-owners 46

All information compiled using surveys, publicly available data and contact with industry sources. Other companies may be eligible for inclusion. If you believe your company is eligible, please email: [email protected] WND: Would Not Disclose, NFP: Not For Publication, N/A: Not Applicable or Not Available.

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Data & Insights WA’s LARGEST SHOPPING CENTRE OWNERS Data & Insights WA’s LARGEST SHOPPING CENTRES Ranked by size of total area (in metres squared) Ranked by Gross Lettable Area (in metres squared)

Year No. of Senior executive and No. of WA Senior executive est. in Gross Lettable Area Speciality

Rank from e Chang year previous Company name title Size of Total Area in m2 centres WA Shopping centre name and size Rank from Change year previous Shopping Centre name and title WA (GLA) in m2 Owner/Manager Shops Notable clients

Galleria 50% (40,685), Ellenbrook Central (47,748), Warwick Grove (32,250), Rockingham Shopping Centre 50% (31,110), David Jones, , H&M, Uniqlo, Target, Kmart, 1 — Vicinity Centres Mr Grant Kelley 284,492 12 Maddington Central (27,837), Karratha City 50% (11,740), Dianella Plaza (17,161), Mandurah Forum 50% (33,008), 1 — Westfield Carousel Ms Maeve Foley 1972 110,000 (a) & (b) Scentre Group. Owner and operator 380 Woolworths, Coles, Mecca Maxima, JB HiFi, Rebel, Best Managing director Livingston Marketplace (15,601), DFO Perth 50% (11,917), Victoria Park Central (5778), Halls Head Central 50% (9657) Centre manager of Westfield in Australia & New Zealand & Less, Hoyts, Cotton On Mega, JD Sport, Reject Shop. Mr John Bond Primewest Albany Central (10,328), Primewest Busselton Home Depot (22,992), Primewest Melville (20,300), Bunbury Lakeside Joondalup Ms Gemma Hannigan (a) Lend Lease Funds Management Limited / Myer, Target, Kmart, Woolworths, Coles, Big W, Farmer 2 — Primewest 243,423 19 Centrepoint (16,813), Cottesloe Central (12,495), Southern River Shopping Centre & Showrooms (12,209), Primewest 2 — 1994 99,659 Future Funds 330 Co-founder, executive chair Northlands (8,258), Primewest Osborne Park (14,625), Primewest Gosnells (7,965), Primewest Gwelup (5,143)… Shopping City Centre manager (b) Lend Lease Property Management Jacks, Aldi, JB Hi Fi, Rebel, Best & Less, H&M. Mr Chris Barton (a) Scentre Group and GIC Real Estate 3  Scentre Group Regional manager, WA 236,437 4 Westfield Carousel (110,000), Westfield Whitford City 50% (42,547), Westfield Innaloo (47,780), Westfield 3 — Westfield Whitford City Mr Chris Barton 1978 85,094 (b) Scentre Shopping Centre Management 314 Target, Big W, Coles, Woolworths, Bunnings, JB HiFi, & SA Booragoon 50% (36,110) Centre manager (WA) Rebel, Lincraft, Aldi

Mr Ross Robertson 4 The Square Mirrabooka (41,816), Cockburn Gateway (49,817), Belmont Forum (47,680), Galleria Shopping Centre Galleria Shopping Mr Graham Hahn 1994 (a) Vicinity Centres and Perron Investments 180 Myer, Target, Kmart, Woolworths, Coles, Aldi, Greater 4  Perron Group Managing director 179,998 50% (40,685) 4 — Centre Centre manager 81,371 (b) Vicinity Centres Union Forrest Chase (42,005), Mandurah Forum 50% (32,000), Enex 100 (8,294), Brighton Village Shopping Centre 5 — ISPT Mr Daryl Browning 135,282 8 (4,622), Halls Head Central 50% (9,657), Banksia Grove Village (8,626), Beeliar Village (8,908), Lakelands 5 — Westfield Booragoon Mr Daniel Ramsdale 1972 72,221 (a) AMP Capital Investors and Scentre Group 188 Myer, David Jones, Coles, Woolworths, Kmart, Zara, Chief executive Shopping Centre (21,170) Centre manager (b) AMP Capital Shopping Centres Apple, Nespresso Mr Chris Learmonth Lakeside Joondalup Shopping City 50% (49,870), Armadale Shopping City (31,916), Southlands Boulevard Shopping Ms Alison Broadbent (a) VRP Harris Scarfe, Aldi,Target, Big W, Kmart, Woolworths, 6 — Lendlease Group General manager, building, 119,350 4 6 — 1980 69,366 195 WA (21,621), Northgate Shopping Centre (15,943) Centre Centre manager (b) CBGS Coles. Ace Cinema, Best & Less. Ms Karen Draper Ms Jacqueline McKenzie (a) ISPT Core Fund and Vicinity Centres David Jones, Kmart, Target, Big W, H&M, Woolworths, 7 — AMP Capital Asset Manager, WA 104,476 3 Westfield Booragoon 50% (36,110), Ocean Keys Shopping Centre (37,216), Rockingham Centre 50% (31,150) 7 — Mandurah Forum Centre manager 1983 64,000 (b) Vicinity Centres 202 Coles. (a) Vicinity Centres (50%) and AMP Capital 8  SCA Property Group Mr Anthony Mellowes 99,017 7 Busselton Shopping Centre (5,432), Kwinana Marketplace (32,935), Treendale (7388), Currambine Central 8 — Rockingham Centre Mr Aaron Bennett 1971 62,221 Shopping Centre Fund (50%) 181 Target, Kmart, Coles, Woolworths, Best & Less, Rebel, Chief executive (17,031), Kalamunda (8,352), Stirlings Central (8,446), Warnbro (21,433) Centre manager (b) Colonial First State Property Management JB HiFi. Mr Miles Rowe Wanneroo Central (20,536), Albany Plaza Shopping Centre (17,840), South Hedland Square (16,819), Kalgoorlie Karrinyup Shopping Mr Tim Richards (a) UniSuper 9  Charter Hall Regional portfolio 95,390 7 9 — 1973 NFP 180 Myer, David Jones, Big W, Woolworths, Nespresso manager, WA Plaza (9,011), Esperance Boulevard (7,596), Secret Harbour Square (19,714), Swan View Shopping Centre (3,874) Centre Centre manager (b) AMP Capital Claremont Quarter 50% (15,093), Hawaiian's Forrestfield (13,200), Hawaiian's Noranda (11,737), Hawaiian's Bassendean (9,541), (a) Scentre Group, 10 — Hawaiian Mr Russell Gibbs 94,837 10 The Mezz (6,670), The Park Centre (approx 14,200), Duncraig Shopping Centre (3,353), Newpark Shopping Centre (10,001), 10 — Westfield Innaloo Ms Tara Gunning 1967 47,780 (b) Scentre Shopping Centre Management 171 Target, Kmart, Coles, Woolworths. Chief executive Hawaiian's Melville (8,964), Darling Ridge Shopping Centre (2,349) Centre manager (WA) Floreat Forum Shopping Centre (19,000), West Leederville Shopping Centre (5,422), Kinross Central Shopping 11  APIL Group Mr Peter Hughes 77,788 9 Centre (5,500), Champion Drive Shopping Centre (4,700), Ballajura Central (4,680), Carine Glades Shopping 11  Ellenbrook Central Ms Roisin McDonagh 2005 47,748 (a) & (b) Vicinity Centres 95 Kmart, Woolworths, Best & Less, Big W, Coles, Red Dot, Managing director Centre (3,053), Joondalup Gate (24,533), Byford Market Place (5,000), Flinders Square (5,900) Centre manager Reject Shop, Aldi, Petstock, First Choice Liquor

Ms Karen Noad 4 Stockland Baldivis (34,515), Riverton 50% (9,885), Bull Creek (16,897), Harrisdale (15,240) Belmont Forum Mr Shane McLean 1974 (a) Perron Investments (b) JLL 139 Kmart, Big W, Coles, Woolworths, Aldi 12  Stockland Regional retail manager 76,537 12  Shopping Centre Centre manager 47,680

Mr Kevin O'Sullivan 1 Karrinyup Shopping Centre (59,874) Cockburn Gateway Ms Alexandra McAuliffe 1999 (a) Perron Investments (b) JLL 156 Woolworths, Coles, ALDI, Big W, Target, Best & Less, JB 13 — UniSuper Chief executive 59,874 13  Shopping City Centre manager 47,535 HiFi, Cotton On, City Beach Parks Centre (10,621), Springs Shopping Centre (8,672), Cale House Midland (4,049), 2nd Avenue Plaza (1,972), (a) ISPT (Industry Superannuation Property 14 — Erceg Management Mr Allan Erceg 40,107 6 Lakes Shopping Centre (9,238), Alexander Heights Shopping Centre (11,872), Power Centre (9,712) plus 14 — Forrest Chase Ms Christine Johnston 1988 42,005 Trust) Core Fund 29 Myer, JB Hi-Fi, Woolworths Managing director 3,200sqm under construction. Centre manager (b) JLL Ms Allana Edwards 15 — GPA and CGB 29,516 3 Waterford Plaza (14,000), Kardinya Park (13,600), Plaza Arcade (2,598) 15  The Square Mirrabooka Centre manager 1978 41,816 (a) Perron Investments, (b) JLL 107 Big W, Kmart, Coles, Woolworths, Aldi

Mr Raymond Tan 1 Kingsway City Shopping Centre (24,200) Ocean Keys Shopping Ms Sandi Swan 2001 (a) & (b) AMP Capital 100 Coles, Kmart, Woolworths 16 — Tah Land Director 24,200 16  Centre Centre manager 37,216

Mr Rohan Mead Mr Glenn Page (a) SCA Property Retail Trust Big W, Woolworths, Coles Supermarket, Best & Less, Dan Murphy, 17 — Australian Unity Managing director 23,596 3 Busselton Central Shopping Centre (9,062), Dog Swamp Shopping Centre (8,156), Woodvale Boulevard (6,378) 17 — Kwinana Marketplace Centre manager 1972 32,945 (b) Knight Frank Australia 76 The Reject Shop 18 18 Data & Insights GET THE FULL LIST ONLINE businessnews.com.au/bniq/shopping-centre-owners Data & Insights GET THE FULL LIST ONLINE businessnews.com.au/bniq/shopping-centres 46 173

All information compiled using surveys, publicly available data and contact with industry sources. Other companies may be eligible for inclusion. If you believe your company is eligible, please email: [email protected] All information compiled using surveys, publicly available data and contact with industry sources. Other companies may be eligible for inclusion. If you believe your company is eligible, please email: [email protected] WND: Would Not Disclose, NFP: Not For Publication, N/A: Not Applicable or Not Available. WND: Would Not Disclose, NFP: Not For Publication, N/A: Not Applicable or Not Available.

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Showing 6 of 6,910 National retailer lands in WA Property syndicate Quadrant Investments has secured Sydney Tools as a tenant at its Malaga premises, marking the industrial power tool retailer’s initial foray into Western Australia. ... The art of placemaking in retail more relevant in recent years and has never been more important in the world of retail. We know that if ... of a placemaking strategy, the concept has a much broader influence across the retail mix, marketing, ... National syndicate in Perth retail play The Carramar Village shopping centre in Perth’s northern suburbs has been sold for $33.5 million; a move CBRE says represents the largest Perth shopping centre sale for 2020. ... Retailers cut trading hours Nearly half of Western Australia’s major shopping centre retailers are operating on reduced hours despite relaxed COVID-19 restrictions, according to a study conducted by Y Research. ... Retail spending down in June quarter

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