AsheMorgan has acquired Homemaker Prospect from Dexus for $78.9 million, as Large Format Retail (LFR) centres, that are directed at meeting household needs, are firing.
Prospect Homemaker is a 26,000m2 centre with 28 showrooms occupied by brands including Fantastic Furniture, The Good Guys, Snooze, Beacon Lighting and Bing Lee, located in one of the fastest-growing catchments in the country.
JLL’s Nick Willis and Sam Hatcher exclusively sold Homemaker Prospect on behalf of Dexus, who acquired the stake for $64.2 million in 2019.
AsheMorgan is experienced in the sector and sold Sydney’s Crossroads Homemaker Centre in October to LaSalle Investment Management for $282 million – more than double the $140 million paid for the centre in 2018.
Willis said, “Of the five largest retail transactions completed in Australia in 2022 three have been Large Format Retail assets. These have included more recently the sale of Crossroads Homemaker ($282 million), Homeworld Helensvale ($265 million) and Alexandria Homemaker ($200 million) sold to Goodman for last mile conversion. The sale of Prospect Homemaker takes the total LFR sales volume for 2022 to a five-year high and reflects the intensified demand for LFR assets because of the category’s resilience over the past two years.”
“JLL has transacted over $750 million worth of Large Format Retail assets in 2022. Through this, we have seen a structural shift in the investor base attracted to both the sub-sector’s investment fundamentals, as well as also considering their alternative use potential,” said Willis.
AsheMorgan sold Sydney’s Crossroads Homemaker Centre in October to LaSalle Investment Management for $282 million
Hatcher said, “The Large Format Retail sub-sector performed exceptionally well recording the most significant yield compression across all retail sub-sectors in 2020 and 2021 with yields tightening by 105 basis points between the end of 2019 and the final quarter of 2021.”
JLL Research shows that pandemic-induced lockdowns and travel bans were a significant tailwind as household goods spending remains elevated at 31% above pre-pandemic levels. The jump in spending has been driven by strong renovation activity and a sharp increase in demand for home office furniture and equipment.
JLL’s Head of Capital Markets Research, Andrew Quillfeldt said, “Pandemic-induced lockdowns and travel bans served as a significant tailwind for the LFR sector as household goods spending remains elevated at 31% above pre-pandemic levels.
“The acceleration in spending was primarily driven by strong renovation activity and a sharp increase in demand for home office furniture and equipment with consumers spending almost $1.4 billion more a month than pre-pandemic.”
“Given strong consumer spending in the sub-sector, leasing demand has remained robust. Major LFR retailers have continued to remain optimistic with NCK expecting to open a minimum of six new stores nationally in FY23; two Nick Scali stores and four Plush stores,” said Quillfeldt.
