Melbourne, 22 January 2014 - A Bunnings Warehouse at Torquay within the Surf Coast of Victoria has sold to a private investor for $11,200,000.
The sale price translates to a yield of 6.52%, the strongest result achieved for a Bunnings Warehouse since 2007.
The transaction follows the recent sale of Bunnings Mentone for $42,950,000, which represented a yield of 6.75%.
Bunnings Torquay was sold via a Public Tender campaign, through CBRE Victorian Retail Investments agents Mark Wizel and Justin Dowers, in conjunction with Gross Waddell/Darcy Jarman agents Andrew Waddell and Tim Darcy.
CBRE Associate Director Justin Dowers said; “The strong 6.52% yield is significantly sharper than the yields that were being achieved for these types of assets in 2012. It also eclipses the 6.75% yield achieved for Bunnings Mentone.”
Mr Dowers added; “The result highlights significant yield compression in the past 18 months for this style of asset on the back of a low interest rate environment, improving confidence in the retail sector and the ongoing chronic lack of supply of quality Victorian retail investment properties.”
CBRE’s Mr Wizel said 12 conforming and unconditional tenders were received, predominantly from Victorian and interstate private investors. The end purchaser was a Victorian based private investor.
The 6,912 square metre warehouse is located on a 19,310 square metre corner site on the outskirts of the Torquay town centre.
“This was a very strong result for the region, and this unprecedented level of interest received underwrites the confidence the buyer market has in quality Victorian retail investments, particularly those backed by such as strong covenant,” Darcy Jarman Director Tim Darcy added.
Bunnings recently reported strong total store sales growth of 10.4% for the first quarter of the 2013/2014 financial year, with store-on-store sales growing 7.1%, a clear indicator that retail spending is improving.
With a number of new housing and land sub developments underway in the Torquay area, Andrew Waddell of Gross Waddell said there was a high level of confidence in the market’s growth prospects. For Australian/international news or global stories, follow us on Twitter. About CBRE Group, Inc.
