Sydney, 13 April 2013- The Kings Cross Centre beneath Sydney’s iconic Coca-Cola sign has been sold to an offshore investor for $23.81 million.
CBRE and City Commercial negotiated the sale of the high profile convenience centre on behalf of the Challenger Premier Hybrid Property Fund. The deal reflects an initial yield in the high 7% range.
CBRE’s National Director, Retail Investments, Steve Lerche said the marketing campaign had generated considerable interest from local and overseas buyers.
“The level of interest confirms that there is still strong demand for well-located retail investment property,” Mr Lerche said.
“It also highlights that Sydney CBD and fringe property remains an attractive proposition for overseas investors, who were attracted to the King Cross Centre by both its recognisable location and its strong performing anchor tenants.”
This sale completes the strata breakup of the Kingsgate centre by the Challenger fund which last year sold the Fitness First component of the property for $9,150,000, representing a rate per square metre of $3,599.
The Kings Cross Centre was sold at a rate per square metre of $5,375. It is the latest significant sale in the precinct following Australand’s recent sale of the Crest Hotel to local private investors.
Mr Lerche said the two transactions highlighted that King Cross remained a highly sort after location for investment.
The Kings Cross Centre is flanked by fashionable apartment buildings, hip hotels and trendy bars, restaurants and cafes.
It was by marketed through CBRE’s Steve Lerche and Sashi Makkapati in tandem with City Commercial’s Warren Duncan and Miron Solomons.
Mr Duncan said the sale had presented an opportunity to acquire a significant retail holding in an inner city suburb with prominent exposure to William Street.
“The centre’s highly recognised location below Sydney’s iconic Coca Cola sign was a key attraction for prospective purchasers as will the strength of the tenancy profile, with Coles anchoring the centre on a long term lease expiring in 2022.”
The remaining retail outlets are leased to a complementary mix of local and national specialty retailers, with the centre’s long trading hours catering to a growing local population currently estimated at 30,000 people.
The centre is situated in one of the most densely populated areas in Australia, and is adjacent to Kings Cross train station which services around 22,000 commuters a day.
The three-level property comprises 24 specialty shops, including Flight Centre , Guzman Y Gomez, Subway, Pie Face, USA Nails, , Burgerlicious, , and Gloria Jeans. The centre also includes four kiosks and four ATM’s, with the total gross lettable area being approximately 4,429sqm.
“The Kings Cross Centre fills a genuine niche and reflects the dynamics of the residents, office workers and visitors who frequent the area, catering to everyone from tourists seeking convenient food,, trendy restaurants and bars, and quality retail outlets, through to locals who want to be able to buy all their groceries, gourmet needs and dine at street cafes without leaving the area,” Mr Lerche said.
For further information:
Warren Duncan
City Commercial T: +61 2 8354 1180 M: +61 410 508816
E: warrend@citycommercial.com.au
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