Victoria’s retail investment market continues to strengthen, with the IGA Stawell - a freestanding supermarket in the regional town of Stawell – the latest in a series of assets to change hands.
Located at 126-130 Main Street - the town’s major thoroughfare – the IGA Stawell comprises a total trading area of 1,622sqm and more than 100 onsite car parks.
CBRE’s Victorian Retail Investments team negotiated the sale on behalf of vendor Alan Fisher for $5.11 million – reflecting an initial yield of 5.82%.
The asset, which is anchored by a new 15-year lease to Ritchies SUPA IGA, attracted strong buyer interest, with eight offers received during the sale process.
Selling agent Joseph Du Rieu, who brokered the sale in conjunction with Kevin Tong and Justin Dowers, said the strong result highlighted ongoing momentum in the retail investment market.
“Although there have been well publicised concerns around the potential increased cost of debt in the coming months, this transaction highlights the strength of the current buyer market and is further evidence of investors taking a long term position on these supermarkets,” Mr Du Rieu said.
“We were blown away by the response for this property from the 90 plus buyers who enquired, particularly given the location in a township where the permanent population is less than 10,000 people.”
The township of Stawell is best known for the annual ‘Stawell Gift’ - Australia’s richest footrace, which is held annually each Easter long weekend.
Mr Du Rieu went on to say that while single tenanted supermarket assets, anchored by either Coles or Woolworths remained strong, investors were also shifting their attention to properties with alternative tenants that may offer higher yields.
“Given that yields of 5% have typically been reserved for supermarkets operated by Coles or Woolworths, we feel this is a very strong result and a sign of the current market environment,” Mr Du Rieu said.
Further evidencing the strength of the retail investment market, a Chemist Warehouse leased strata shop has been sold to an off-shore investor in Craigieburn for $2.86 million – reflecting an initial yield of 5%.
The Chemist Warehouse in Craigieburn forms part of the Central Park Shopping Centre and is one of six strata retail tenancies.
The 275sqm property sold under the hammer following a highly competitive auction that attracted bids from eight separate parties. The transaction reflected a building rate of
$10,400/sqm - almost double the previous sale rate of $5,709/sqm in 2013.
Mr Dowers said properties in metropolitan locations with fixed income growth and lease tenure of five or more years were rarely offered to the market.
“We have seen a scarcity of stock in prime growth suburbs in recent times and this is fueling the willingness of investors to compete aggressively when properties are offered to the market,” Mr Dowers said.
“With yields for 10 year bonds beginning to rise, many of our vendors are recognising that the market conditions may not be getting any better and are looking to capitalise at the moment.”
Located at 126-130 Main Street - the town’s major thoroughfare – the IGA Stawell comprises a total trading area of 1,622sqm and more than 100 onsite car parks.
CBRE’s Victorian Retail Investments team negotiated the sale on behalf of vendor Alan Fisher for $5.11 million – reflecting an initial yield of 5.82%.
The asset, which is anchored by a new 15-year lease to Ritchies SUPA IGA, attracted strong buyer interest, with eight offers received during the sale process.
Selling agent Joseph Du Rieu, who brokered the sale in conjunction with Kevin Tong and Justin Dowers, said the strong result highlighted ongoing momentum in the retail investment market.
“Although there have been well publicised concerns around the potential increased cost of debt in the coming months, this transaction highlights the strength of the current buyer market and is further evidence of investors taking a long term position on these supermarkets,” Mr Du Rieu said.
“We were blown away by the response for this property from the 90 plus buyers who enquired, particularly given the location in a township where the permanent population is less than 10,000 people.”
The township of Stawell is best known for the annual ‘Stawell Gift’ - Australia’s richest footrace, which is held annually each Easter long weekend.
Mr Du Rieu went on to say that while single tenanted supermarket assets, anchored by either Coles or Woolworths remained strong, investors were also shifting their attention to properties with alternative tenants that may offer higher yields.
“Given that yields of 5% have typically been reserved for supermarkets operated by Coles or Woolworths, we feel this is a very strong result and a sign of the current market environment,” Mr Du Rieu said.
Further evidencing the strength of the retail investment market, a Chemist Warehouse leased strata shop has been sold to an off-shore investor in Craigieburn for $2.86 million – reflecting an initial yield of 5%.
The Chemist Warehouse in Craigieburn forms part of the Central Park Shopping Centre and is one of six strata retail tenancies.
The 275sqm property sold under the hammer following a highly competitive auction that attracted bids from eight separate parties. The transaction reflected a building rate of
$10,400/sqm - almost double the previous sale rate of $5,709/sqm in 2013.
Mr Dowers said properties in metropolitan locations with fixed income growth and lease tenure of five or more years were rarely offered to the market.
“We have seen a scarcity of stock in prime growth suburbs in recent times and this is fueling the willingness of investors to compete aggressively when properties are offered to the market,” Mr Dowers said.
“With yields for 10 year bonds beginning to rise, many of our vendors are recognising that the market conditions may not be getting any better and are looking to capitalise at the moment.”
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About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2016 revenue). The company has more than 75,000 employees (excluding affiliates), and serves real estate investors and occupiers through more than 450 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.
About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2016 revenue). The company has more than 75,000 employees (excluding affiliates), and serves real estate investors and occupiers through more than 450 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.
