MA Financial locks in $525 million Top Ryde mall deal

It’s the first major mall deal since MA Financial, an ASX-listed funds manager, significantly upsized its operations by taking over boutique syndicator IP Generation and its $2 billion portfolio of shopping centres this year.

“We are excited to partner with Keppel REIT to acquire Top Ryde City Shopping Centre on very attractive terms on behalf of our valued stable of investors,” said Chris Lock, who founded IPG Generation and is now head of core real estate at MA Financial.

“The social infrastructure characteristics of the shopping centre provides a defensive foundation for investor returns at a point of time that we believe the tailwinds for the real estate cycle are very favourable.”

The net acquisition price implies a fully leased yield of about 7.2 per cent and represents a 45 per cent discount to the centre’s estimated replacement cost, according to MA Financial. It expects to deliver a distribution yield of 8 per cent and total return of 13 per cent annually in the new fund.

The deal comes amid a return of investor interest in shopping centres after the sector suffered during the lockdowns of the pandemic era. Even so, major malls in Sydney change hands rarely, with only two such centres sold in their entirety in the past two decades.

For Blackstone, the deal is a major milestone as well. The mall at Ryde was a key component in a $3 billion portfolio of 10 shopping centres that the US private equity player had once hoped to sell off through either a float or a mega trade sale, nine years ago.

When that plan fell through, the majority of earmarked malls were then sold individually, leaving Top Ryde as one of the last to be offered for sale. Colliers’ Lachlan MacGillivray and JLL’s Sam Hatcher and Nick Willis were appointed to broker the mall in April this year.