Vicinity Centres Sells 50% Stake in Carlingford Court for $120 Million

About Vicinity Centres

Vicinity Centres (ASX: VCX) is one of Australia’s leading retail property groups, managing a $13.5 billion portfolio of shopping centres across the country. With a focus on premium retail destinations and urban mixed-use developments, Vicinity has increasingly adopted a strategy of active capital recycling—divesting non-core assets to reinvest in higher-performing and strategically aligned properties.

In its latest move, Vicinity has completed the $120 million sale of its 50% stake in Carlingford Court, a sub-regional shopping centre located in north-west Sydney. The transaction is another step in the company’s efforts to reposition its asset base and allocate capital toward flagship developments and high-growth locations.

Details of the Transaction

Vicinity announced that the sale of its 50% interest in Carlingford Court has officially been completed, with the gross sale price of $120 million reflecting a slight premium to the asset’s June 2023 book value. The remaining 50% of the centre is owned by JY Group, a private investor with a portfolio of retail and mixed-use properties.

Carlingford Court is a well-established sub-regional centre, anchored by Woolworths and Target, with over 33,000 sqm of gross lettable area and a mix of everyday convenience and service-based retail offerings.

Despite its stable trading performance, the centre was considered non-core to Vicinity’s long-term strategy. The sale proceeds are expected to be redirected into the group’s development pipeline, which includes Chadstone, Box Hill Central, and Burwood Brickworks, among other key projects.

Strategic Rationale: Focus on Growth and Premium Assets

The sale forms part of Vicinity’s capital recycling program, aimed at unlocking value from mature or lower-growth assets and redeploying proceeds into higher-return opportunities.

According to Vicinity’s Chief Investment Officer, Michael O’Brien, “This transaction is consistent with our strategy to focus our capital on premium and destination assets that offer superior growth prospects and mixed-use development potential.”

Vicinity has been progressively reshaping its portfolio over the last several years, divesting smaller regional or suburban assets and increasing exposure to urban and high-footfall retail centres. This includes landmark destinations such as Chadstone in Melbourne, Queen Victoria Building in Sydney, and DFO Brisbane.

Capital Redeployment and Development Pipeline

Proceeds from the Carlingford Court sale will be used to support Vicinity’s $2.9 billion development pipeline, which includes projects in major metropolitan areas. These developments are focused not only on retail upgrades but also on introducing office, residential, and hotel elements to enhance long-term value creation.

One of the group’s most significant ventures is the Chadstone masterplan, which includes a new office tower, hotel expansion, and increased leisure and dining precincts. Other priority developments include the transformation of Box Hill Central into a mixed-use urban hub and enhancement of The Glen shopping centre.

Vicinity believes that by concentrating on these premium centres, it can achieve higher foot traffic, stronger tenant demand, and greater rental growth over time.

Market Response and Investor Outlook

The market responded positively to the announcement, with investors viewing the sale as another sign of prudent capital management and long-term strategic focus. While the transaction is not expected to materially alter FY2024 earnings, it contributes to strengthening the balance sheet and maintaining funding flexibility.

Vicinity’s portfolio optimisation efforts show that a more concentrated focus on is high-performing assets that should drive better operational metrics and capital efficiency.

The group’s balance sheet remains strong, with gearing levels within target ranges and sufficient liquidity to fund current and future developments.

Portfolio Trends and Sector Context

The divestment comes amid a broader trend in the retail property sector, where landlords are selectively shedding non-core assets to navigate structural shifts in consumer behaviour and retail leasing.

Vicinity’s portfolio transformation has resulted in a higher weighting to premium urban centres, with stronger demographics, catchment areas, and mixed-use opportunities.

The retail sector continues to evolve, with a growing emphasis on experience-led retail, integrated services, and mixed-use precincts that can withstand changing economic conditions and deliver more stable, diversified income streams.

Carlingford Court, while well-located, was considered less aligned with this vision—offering limited redevelopment potential compared to Vicinity’s major metro assets.

Vicinity Centres’ $120 million sale of its 50% stake in Carlingford Court represents another strategic step in reshaping its retail property portfolio. By exiting lower-growth assets and reallocating capital into high-performing, future-focused developments, the group continues to position itself as a leader in Australian retail and mixed-use property.

The transaction highlights Vicinity’s disciplined capital management and focus on long-term value creation. As the group advances its pipeline of transformative urban projects, it remains committed to delivering sustainable growth, strong returns, and enhanced experiences for both tenants and consumers.