ISPT offloads Blue Mountains shopping centre for $34.8m
Super fund-backed property fund manager Industry Superannuation Property Trust (ISPT) has sold a shopping centre in the Blue Mountains to Sydney-based asset manager Precept Property Partners for $34.8 million.
ISPT, which recently became a subsidiary of global institutional investor and asset manager IFM Investors, purchased Katoomba Village in Katoomba from Coles Group. It initially acquired a 75 per cent stake in the shopping centre in 2013 for around $24 million, before purchasing the remaining 25 per cent in late 2016 for about $8.65 million.
Its new owner, Precept Property Partners, manages more than $200 million worth of commercial real estate and is led by chief executive and co-founder Grant Traub, who also heads property investment management firm Oceana Property Partners in Sydney.
Anchored by Coles and Liquorland with a 20-year lease, Katoomba Village was listed for sale in March. It has 5400sq m of gross lettable area and has an additional five specialty tenants, two kiosks and two ATMs.
The deal, brokered by JLL’s Sam Hatcher, Sebastian Fahey and David Mahood as well as CBRE’s James Sherley and James Douglas, follows a string of retail sales by the super fund, some of which have failed to meet price expectations.
ISPT offloaded another shopping centre at 206 Bourke St, Melbourne, in June for $80.1 million – about $36 million less than what they paid for it in 2015 – and the Dee Why Grand Shopping Centre on Sydney’s northern beaches for $60 million in 2024. They’re also looking to sell a number of office buildings across Sydney.
An ISPT spokesperson said the super fund manager regularly assessed its properties, divesting, reinvesting and repositioning assets as required to drive stronger returns for their investors.
“We see retail – particularly non-discretionary retail assets – as strategic and highly defensible, and will continue to grow our funds with a focus on these assets,” they told The Australian Financial Review.
CBRE’s Douglas said food, service and convenience retail, which had long shown its value, resilience and reliable cash flows were highly sought after at the moment.
JLL’s Mahood said demand for neighbourhood centres remained strong, with Katoomba Village being NSW’s seventh such transaction in 2025.
“With Sydney retail assets tightly held, investors are targeting regional supermarkets for their stability and growth potential,” he said. “Meanwhile, high construction costs have limited new supply, seeing demand quickly outpace supply.”
The scarcity of retail space is a factor for major malls as well. With Australia running out of mall space, high construction costs mean it is cheaper to buy a big shopping mall than to develop a new one, UniSuper’s property chief Kent Robbins told the Financial Review this month.
“Why is no one building any super regional malls at the moment? You can buy them for 37 per cent less than what it would cost you to build them,” Robbins said.
