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For-sale signs have gone up at one of New Zealand’s most prominent shopping centres, Botany Town Centre.
The southeast Auckland shopping centre has been brought to market in what’s described as “a rare 100 per cent ownership opportunity”.
It offers investors the chance to acquire “a dominant retail destination with established trading performance, significant scale and an immediate management platform”.
The sale campaign is expected to attract Australian, New Zealand and international capital interest.
Colliers’ Lachlan MacGillivray, Richard Kirke and Blair Peterken, alongside JLL’s Nick Willis, Sam Hatcher and Harry Fergusson, have been appointed to manage the international expressions of interest campaign for the 60,825-square-metre Botany Town Centre.
That campaign closes on Wednesday, October 14.
The offering represents the largest 100 per cent interest with management ever brought to the New Zealand retail market, highlighting the scarcity of opportunities to acquire this scale in a single transaction.
“This is a super-rare offering,” says MacGillivray, managing director for Colliers Asia Pacific Retail Capital Markets.
“Opportunities like this are often sought after and very rarely available particularly in New Zealand where there are so few opportunities to acquire a dominant regional shopping centre of this scale in one transaction.
“Botany’s location in metropolitan Auckland is a major strength, with the centre serving a large and growing catchment and benefitting from significant investment in transport infrastructure.
“Its diverse tenant mix of leading national and international retailers across fashion, food, grocery, entertainment, fitness and everyday services reinforces its position as a major retail destination,” says MacGillivray.
Located 18.5 kilometres southeast of Auckland’s CBD, Botany Town Centre is New Zealand’s fourth-largest shopping centre generating $354.7 million in annual turnover, GST exclusive to July.
The centre comprises 200 tenancies across 60,825sqm of gross lettable area and is anchored by Farmers, New World, and Hoyts, with a diverse mix of national and international retailers including H&M, Rebel Sport, Briscoes, JB Hi-Fi, CityFitness, Chemist Warehouse, Timezone, and Mecca.
The centre opened in 2001 and underwent a $78m redevelopment in 2019, creating a modern retail destination serving a trade area population of approximately 500,760 people, forecast to reach 643,810 by 2046.
The catchment is expected to grow at an average annual rate of approximately 1.3 per cent, well ahead of the projected national average of 0.9 per cent.
“The scale of Botany Town Centre, combined with its established trading performance and the investment undertaken through its 2019 redevelopment, positions it as a highly established retail destination,” says Hatcher, head of retail for JLL Australia and New Zealand.
“The centre also forms part of a broader retail and lifestyle precinct generating an estimated $600m-plus in annual turnover.”
Botany Town Centre is located within one of 10 designated metropolitan centres under the Auckland Unitary Plan, supporting its long-term role as a major retail, commercial, employment and community destination.
The $1.4 billion Eastern Busway under construction will further enhance connectivity to the centre as the area continues to grow.
Botany Town Centre occupies a 17.3-hectare freehold site with approximately 35 per cent site coverage.
Combined with its business metropolitan centre zoning, strategic location and improving transport connectivity, the substantial landholding provides long-term potential for future development including residential and mixed-use uses, subject to planning and consent.
“The Eastern Busway will enable a continuous rapid transit corridor through to Botany Town Centre, further improving accessibility while supporting the broader growth and intensification of the area,” says Kirke, director for Capital Markets at Colliers.
“For an investor, it means you’re buying into an established destination today while gaining exposure to the evolution of one of Auckland’s most important growth corridors.”
The investment case is further supported by New Zealand’s retail fundamentals including population growth and limited supply of retail floorspace.
New Zealand also offers a comparatively attractive fiscal environment for investors with no broad-based capital gains tax, no stamp duty, and no land tax.
Despite the potential for further interest rate increases, financing conditions remain comparatively favourable for investors.
The opportunity comes as Australian capital continues to assess relative value across New Zealand’s commercial property market.
“We’re seeing a clear acceleration in capital appetite for New Zealand retail, and the fundamentals support it,” says Willis, the executive director of retail investments at JLL Australia and New Zealand.
“The attractive tax regime, favourable financing environment and strong momentum in transaction activity is driving investment confidence in the New Zealand retail market.
“Against that backdrop, and with pricing and competition tightening in the Australian market, offshore and domestic capital – particularly from Australia, the United States and across Asia-Pacific – is increasingly looking across the Tasman for relative value.
“Following the recent major sales of Manukau Supa Centa and Glenfield Mall, we expect Botany to attract the same breadth of interest.”
