Singapore’s Keppel Capital and listed Australian shopping centre owner Vicinity Centres have called off their A$1bn (€608m) 50-50 joint venture to hold Australian retail centres, blaming low investor interest in retail funds.

Citing the prevailing poor sentiments on the retail sector, Vicinity’s CEO Grant Kelly said the Vicinity Keppel Australia Retail Fund (VKF), launched of VKF a year ago, would not proceed.

Kelly said as the year progressed, however, investors demand for retail property funds continued to soften globally.

This, he added, was compounded by a “crowded divestment market” which had impacted retail property pricing in Australia.