Vicinity Sells Suburban Perth Shopping Centre To Realside

Property investor Realside has struck a deal to buy Maddington Central, a shopping centre located 17km from Perth’s central business district, from listed landlord Vicinity Centres for $107 million. Now, it’s seeking equity backers to come in on the investment.

Street Talk understands potential investors have been told Realside has secured the investment in an off-market trade at a small premium to the $97 million book value. However, the acquisition price is a 40 per cent-plus discount to the land and replacement value, while also being lower than Vicinity’s $122 million peak valuation for the asset.

Realside boss Linda Rudd, a former partner at Knight Frank Australia, has been meeting with high-net-worth types, alongside founder Mark Vonic, who was previously the chief investment officer of Primewest. The book is slated to shut on May 8.

Fund-raising documents state a base-case scenario of 8.5 per cent annual cash yield and 15.5 per cent internal rate of return over a five-year holding period.

Returns could be juiced up by the asset’s circa three hectares of vacant land, with wide. zoning that could house build-to-rent developments, logistics, a childcare centre, gym or medical centre.

The sub-regional mall was built in 1980, last refurbished in 2020, and sits on 13 hectares of land. Key tenants Woolworths, Coles and Kmart which have an average WALE of greater than eight years, underwrite $207 million in moving average turnover. Coles, in particular, is in discussions to sign on for another 10 years, according to the fund-raising documents.

Prospective hackers have been told it is a well-timed acquisition, with yields forecast to tighten from 2025.

It’s a small deal for Vicinity, which has a total portfolio value of $14.36 billion.

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