Centuria Capital Group (ASX: CNI or “Centuria”) has secured the Busselton Boulevard Shopping Centre in WA for $16million, which will underpin a new a single-asset, closed-ended wholesale property fund, called the new Busselton Boulevard Shopping Centre Trust (BBSCT or Trust).

The combined total for the two deals was $31 million, with CBRE’s James Douglas and Chloe Mason negotiating both transactions with VPG Property’s Craig Butler and David Walser.

The daily needs neighbourhood shopping centre is anchored by a Coles Supermarket and provides a 3.25-year WALE [1] and 99% occupancy [2]. Located on 69 Prince Street, Busselton, the single-storey shopping centre benefits from a further 15 convenience retailers. Ninety-two per cent of the centre caters to food and non-discretionary spending.

Jason Huljich, Centuria Joint CEO, said, “This was a rare opportunity to secure a high performing neighbourhood shopping centre that provides a resilient revenue stream underpinned by non-discretionary spending. This acquisition is another example of Centuria securing high-performing, quality retail assets within WA communities that will benefit from growing economies, driven by population growth [3]. We continue to secure value-add opportunities to match specific profiles within our broad unlisted investor network and are pleased to provide a new investment vehicle to our HNW investor base.”

The Busselton Boulevard Shopping Centre follows the success of Centuria’s Margaret River Shopping Centre Trust, which was established in January 2023 and was fully subscribed.

BBSCT provides a forecast initial starting distribution yield of 7.50% pa, monthly distributions and an initial five-year term. It has a minimum entry investment of $100,000. Centuria will seek to raise c.$10.7 million to launch the Trust with an anticipated launch date of July. Settlement is expected in late August 2023.

“The Busselton transaction demonstrates that capital remains active for well located, strong performing retail assets focused on food, service and convenience where there is an opportunity to enhance the asset’s income profile,” CBRE’s James Douglas said. There was significant investor enquiry for both the Busselton and Margaret River centres from eastern seaboard and west coast capital, with over 120 enquiries fielded from a variety of investor types. This demand for resilient, defensive assets continues, with the transaction representing the fourth Western Australia neighbourhood shopping centre sale by CBRE in the past 12 months for a total of circa $205 million.”

VPG Property’s Craig Butler added, “Investors were attracted by the centre’s defensive income stream which benefits from dual catchments including permanent residents as well as a burgeoning tourism influence.”

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The acquisition adds to Centuria’s existing $1.7billion daily needs retail platform [4].

1 Weighted Average Lease Expiry (WALE) as at 1 June 2023 

2 Occupancy by income as at 1 June 2023

3 According to the ABS and RDA South West, between the 2016 and 2021 Census, Busselton experienced a 10.8% surge in its local population 

4 As at 31 March 2023