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Centuria acquires $35m Taree subregional shopping centre

Manning Mall provides value-add, counter-cycle opportunity

  • Manning Mall secured at 47% below replacement cost1, anchored by Coles and Target
  • Underpins a single-asset unlisted wholesale fund; forecast 8% distribution yield2, initial five-year term
  • Value-add counter-cyclical investment opportunity, supported by strong population growth forecasts

Centuria Capital Group (ASX: CNI or “Centuria”) has secured a $34.85 million subregional shopping centre for a new single asset, closed ended wholesale fund, Centuria Manning Mall Fund (CMMF).

Located in Taree on NSW’s mid-north coast, the c.10,800sqm Manning Mall shopping centre was secured at a 47% discount to replacement cost1. It is anchored by a high-performing Coles Supermarket, which generates annual sales well above the supermarket chain’s store average3 with a long-term lease expiry ending 2034.

The centre also includes a Target, 27 specialty stores, four kiosks and 422 on-grade car parks. ASX-listed and national retailers comprise 64% of asset’s gross annual income. The asset provides a 4.95-year WALE and 94% occupancy.

Jason Huljich, Centuria Joint CEO, said, “Manning Mall provides a counter-cyclical investment opportunity for our broad network of wholesale and high net worth investors, aiming to capture the strong investment appetite we experienced with our over-subscribed Centuria Halls Head Central Fund earlier this year. Through Centuria’s proactive inhouse management capabilities, we aim to upgrade the Centre and capture positive rental revisions.”

Bruce McCully, Centuria Head of Retail, added, “Centuria has significant experience in successfully executing value-add strategies across the retail sector. In addition to capturing tailwinds from an expanding local population, we believe Manning Mall will benefit from repositioning its tenancy mix to better align with local customer demographics.”

Taree’s population is anticipated to increase c.25% by 20414 with retail expenditure, in turn, expected to increase at an average rate of 3.7% p.a. to $1.59 billion across the same period5.

In May, Centuria acquired Halls Head Central in WA, a subregional shopping centre providing a 40% discount to its replacement cost.

The single-storey Manning Mall is positioned in the heart of the Taree Central Business Area on a 29,740sqm freehold island site bordered by Manning Street (west), Wynter Street (north), Macquarie Street (east) and Albert Street (south). It is well-serviced by public transport including Taree Station, which is 500m away.

CMMF will provide an initial five-year term and is expected to be offered to wholesale investors from early November 2024, with a forecast average annual distribution of 8.00%2, paid monthly. The Fund has a targeted equity raise of c.$21 million with investments starting from $100,000.

Settlement of the property is anticipated in December 2024.

Colliers’ James Wilson and Ben Wilkinson facilitated the transaction.

  1. CBRE Replacement Cost Assessment based on replacement cost of $56.61 million plus land costs
  2. Distribution will be paid if declared by Centuria Property Funds No.3 Limited and will be subject to the terms, assumptions and risks set out in the IM
  3. Source: Urbis research
  4. Source: LocationIQ Report: Taree’s Main Trade Area population is currently estimated at 54,963 (2024) and over the period to 2041 is projected to grow to 68,563 persons at an average of 1.3% per annum (over double the Non-Metropolitan NSW average rate of 0.5%).
  5. Source: LocationIQ Report.