Property on the table
Some of the country’s biggest property developers give a snapshot of the market now and what should be hot or not as the nation recovers from COVID-19. Read More
Larry Schlesinger, May 19, 2021
Melbourne real estate financier and investor Wingate and developer Azzura have sold the Mercato shopping centre in the heart of Byron Bay for about $120 million in one of the biggest ever commercial deals in the booming NSW coastal town.
The Woolworths and Palace Cinemas-anchored mall and a neighbouring development site spanning 1.1 hectares at 98-116 Jonson Street was purchased on a yield of about 5 percent by a family fund headed by the Mustaca family, owners of United Cinemas, and the Pelligra family, major real estate developers.
Also in on the deal were fund managers Jason Meares of Option Group and Chakyl Camal of Panthera Group.
Wingate acquired a 75 percent stake in the mall in 2015 when it bought into the project being developed by Gold Coast property developer Robert Badalotti’s Azzura International.
Speaking on behalf of the joint venture, Mark Harrison, managing director of Wingate Property, said that the result was a testament to the unique and high-quality nature of the assets.
“The continued expansion of Byron Bay as one of Australia’s most desirable destinations has been well covered.
“Wingate partnered with Azzura six years ago to help bring this development to life, as the first commercial development of its type to be approved in Byron Bay.”
“Mercato is now Byron’s largest shopping centre.”
The sale was handled by JLL’s Nick Willis, Jacob Swan and Sam Hatcher.
Mr. Swan said capital market conditions remained supportive of investment demand for real estate, including non-discretionary retail assets.
“We recorded $818 million of retail transactions in the first quarter of 2021, the highest first-quarter result since 2015. We see the activity continuing into the back half of 2021,” he said.
The sale of the Mercato follows a spate of major commercial real estate deals in Byron Bay, where property prices in the formerly hippy town are booming following an influx of wealthy city-dwellers and Hollywood celebrities such as the Hemsworth brothers.
Directly adjacent to the Mercato, Sydney developer Podia paid $18.55 million in February to buy the Byron Bay Backpackers at 116-118 Jonson Street with plans to redevelop the 4287 square metre site.
Last month, the Rich Lister Flannery family sold its Sun Hotel adjacent to the Elements of Byron resort to Winchester Group. Price expectations were between $10 million and $12 million.
In another noteworthy sale in late 2019, Byron Bay’s Beach Hotel sold to listed investment house Moelis Australia in a then-record deal worth more than $100 million.
“The Panthera Group is excited to partner with Jason Mears of Option Fund Management and the Mustaca and Pelligra families in this venture and we are very optimistic about the future of Byron Bay to become the premier
national and international tourism and film industry destination, particularly with Australia’s reputation as a safe place to visit and reside during the pandemic,” said Panthera Group CEO, Chakyl Camal.