MA Financial launches $500m fund

MA Financial Group is bringing a new retail real estate fund to life, as it continues to increase its footprint with the acquisition of a 50% stake in a Melbourne shopping district for $327.5 million.

The launch of the MA Large Format Retail Fund follows the acquisition of Taigum Square Shopping Centre and ECQ XL large format retail centre (ECQ) acquisition for a combined $170 million, with ECQ acting as a seed asset in the fund.

The fund will assemble a diversified, institutional-scale portfolio of Australian large format retail (LFR) assets, with a target portfolio size in excess of $500 million, MA Financial said.

The group will seek to raise an initial $28 million to fund the $49 million acquisition of ECQ.

MA Financial co-head of core real estate Chris Lock said the fund is already in advanced due diligence on two further assets.

"We have strong conviction in Australian large format retail, where constrained supply, low vacancy rates and embedded rental reversion are creating attractive opportunities for income growth," Lock said.

"We also see significant potential to create value through leasing, repositioning and active asset management within the assets we are focussed on initially acquiring for the new fund."

The group has now transacted $500 million worth of retail assets in 2H26, including the just-announced majority stake acquisition in The Glen Shopping Centre located in the southeast part of Melbourne.

MA Financial joint chief executive Julian Biggins noted the transaction has lifted its retail real estate assets value to almost $5 billion.

"Following the settlement of these recently exchanged assets, MA Financial will have almost $5 billion of retail real estate assets in its funds, having transacted on an additional $2 billion of assets since acquiring the IP Generation business just 12 months ago," Biggins said.

"This underscores our strong belief in the structural and macroeconomic tailwinds supporting Australian retail real estate, including population-led demand growth, resilient consumer expenditure, severely constrained supply and lower retail floorspace relative to global peers.

"This is driving both rental growth and shopping centre valuations."

The acquisition price implies a passing yield of approximately 7%. The transaction is expected to settle in the fourth quarter of the year.

Lock added the shopping centre is an institutional-grade retail asset located in a prime area.

"This was a rare investment opportunity to acquire a 50% share in a large-scale high-performing shopping centre that is an entrenched retail destination in one of Melbourne's most affluent catchment areas," Lock said.

"Centres of this scale and trading performance rarely transact, with only three regional shopping centres having traded in greater Melbourne over the past decade."

Separately, an AFR article reports that the MA Real Estate Income Fund is experiencing an increase in the number of loans being defaulted for more than 30 days.

MA Financial declined to comment when asked by Financial Standard about this but noted the newly launched fund is distinctly different in strategy to the MA Real Estate Income Fund, which focuses on private credit.

The firm limited redemptions on another separate fund as a proactive measure in response to the potential increase in redemption activity in August.