TAMIM Property has sold Home + Life Rutherford, a Large Format Retail (LFR) centre in Maitland, New South Wales, to Spotlight Property Group. This marks the second asset traded by the boutique investment firm, with investors reportedly achieving a net IRR of over 18%.

JLL's David Mahood and Sebastian Fahey handled the divestment of Home + Life Rutherford.

As demand for retail investments rebounds, year-end transaction volumes reached AUD 8.4 billion in 2024, representing a 35% increase year-over-year and a 7% increase over the prior 10-year average. The LFR investment market has been one of the thinly traded asset classes in the retail sector, with transaction volumes totalling AUD 695 million, just over a third of the peak of AUD 1.8 billion in 2022.

Mr Mahood said, "The LFR sector has been one of the strongest performing retail sectors since 2020, with average rental growth of 0.8% every quarter since the end of 2020, underpinned by strong tenant demand as vacancy rates diminish nationally to 3.3%."

"This is further highlighted by the asset class's strong underlying fundamentals, being land-rich and virtually irreplaceable given the current elevated construction costs." Mr Mahood added.

Large format retail has benefited from both cyclical and structural sector themes. The cyclical surge in retail spending on household goods, driven by various factors including home renovations, has resulted in sales growing by 32% since the start of 2020.

Mr Fahey said, "The sector's performance is further bolstered by the diminishing supply pipeline, with national forecasted supply at record lows. An average of 32,000 sqm per annum of gross floor space is expected to come online by 2027, 49% below the 10-year historical supply."

Zac Fried, Executive Deputy Chairman of Spotlight Group, said, "The acquisition of Home + Life Rutherford demonstrates Spotlight Property Group’s continued interest in growing our store network, existing store’s footprint, as well as purchasing existing operating Centres.”

TAMIM Property’s founder Jeff Taitz added, “The successful sale of Home + Life Rutherford Centre marks the culmination of our strategic value-enhancement program, delivering an accelerated exit three years ahead of schedule. Since acquiring the asset in 2020, we have significantly increased its value by driving higher foot traffic and extending patrons' shopping time through the introduction of food options, as well as implementing a rigorous maintenance and upkeep program to ensure a high-quality retail environment. These initiatives enhanced the centre’s appeal, optimised income streams, and strengthened tenant performance - all without incurring repositioning costs or lease expiry risks.

While we are proud of what we have achieved with this high-performing asset, we are confident it is in capable hands. We extend our best wishes to Spotlight Group and are pleased to see the centre’s future secured with a well-respected industry leader. This transaction underscores our disciplined approach to asset management and commitment to generating strong, risk-adjusted returns, reinforcing our track record of unlocking value and maximising investor outcomes." Mr Taitz concluded. 

The transaction of Home + Life Rutherford follows other notable LFR transactions, including the sale of HomeCo Logan, QLD, which was acquired by Centuria for AUD 115 million, and Joondalup Square, WA acquired by Barings for AUD 74 million.

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