New retail partnership for Charter Hall

Charter Hall has entered into its sixth retail partnership in order to acquire Pacific Square Shopping Centre in the Sydney suburb of Maroubra for $137 million. 

The partnership, RP6, is with an undisclosed existing pooled fund client of Charter Hall. The off-market deal was brokered at a market capitalisation rate of 6.5 per cent.

Charter Hall has committed 20 per cent of $2 million in equity commitments, with $20 million to be invested in the purchase of Pacific Square.

David Harrison, joint managing director of Charter Hall, said RP6 will have approximately $2 million of additional capacity based on targeted gearing of 35 per cent.

Harrison believes the 13,723 sqm inner suburban shopping centre will deliver strong results for investors.

“Maroubra is one of Sydney’s most highly urbanised suburbs which has seen steady population growth in recent years. With the area forecast to see further densification, following the delivery of a number of future residential developments, we believe Pacific Square will continue to perform well for our investors and the local community,” he said.

The shopping centre has 99 per cent occupancy. It is anchored by supermarkets Coles and Aldi and features specialty retailers and a Fitness First that occupies a gallery level of 20 sqm.

Completion of the purchase is slated for late April; the acquisition will boost Charter Hall’s retail property portfolios to $3.4 billion.