This article is from the Australian Property Journal archive
HIGH net worth investors have picked off $94.3 million worth of commercial properties at a portfolio auction, which saw a 94% clearance rate and the sale of an EG Woolworths Caltex fuel and convenience station on an ultra-low 2.89% yield.
Seventeen assets sold at the Cushman & Wakefield national investment sales portfolio auction event, on an average yield of 4.73%, with the total sales figure coming in at more than $13 million above reserve. Nearly 370 bids were put forward.
The auction was led by a portfolio of nine EG Woolworths Caltex assets. They collectively sold for $54.5 million, with yields ranging between from the 2.89% achieved with the $8.8 million sale of a Brookvale site in Sydney’s northern beaches, up to 5.75%.
Another site in Sydney’s Newport trade on a 3.25% yield, on an $8.3 million price tag.
The event was livestreamed to auction rooms in Brisbane and Melbourne along with remote bidding activity from Hong Kong, Perth, Darwin and regional locations. This also included from Ballarat, where a local investor purchased the Lucas Ballarat Woolworths Caltex petrol station for $3.15 million, representing a record-breaking regional yield of 5.4%.
Cushman & Wakefield’s Michael Collins, Aaron Dahl, Yosh Mendis, Tom Moreland, and Geoff Sinclair managed the sales campaign.
“Seeing petrol stations sell on sub-3% yields is reflective of the market dynamics at present, as high net worth investors continue to target defensive assets and scour the market for higher yielding investment opportunities.
“One Sydney-based high net worth family spent $15.4 million on assets in Brookvale and Bulli, underscoring the value likeminded investors see in these properties.”
“We are regularly seeing private investors bidding up these properties beyond reserve, and vendors looking for opportunities to lock in capital appreciation. It’s a win-win for both parties currently.”
Among the five childcare investments offered located across New South Wales and Queensland, a Taigum site in Brisbane sold for $8.31 million to a Hong Kong based investor. A centre leased to ASX-listed G8 Education in regional New South Wales attracted 71 bids before selling for $2.5 million on a yield of 5.1%.
Prior to the auction, an asset in Coomera on the Gold Coast sold for $6,309,000 at a yield of 5.48%.
Regional assets to change hands included a highway retail centre in Bomaderry, anchored by Domino’s and Red Rooster, for $8,050,000 on a 4.66% yield, which Cushman & Wakefield said was the lowest ever paid for an asset of its kind in a regional location.
A Melbourne-based private family snapped up an Officeworks-tenanted asset in Brisbane’s Aspley for $9.5 million on a 4.93% yield.
“Private investor demand for commercial real estate assets continues to go from strength to strength, extending its run in late 2020,” Collins said, adding that the agents sent out almost 400 contracts pre-auction and clearance rates across its last three events are running around 90%.
Moreland said this level of activity is expected to remain for the foreseeable future, as investors seek passive commercial opportunities backed by defensive industries, particularly those that traded well through the pandemic.
Cushman & Wakefield’s next portfolio auction even will be held late in April, with 12 properties to be offered with expectations of selling for a combined $62 million. Among the assets are childcare centres, fuel and convenience retail assets, two regionally located Toyota dealerships, and retail shops located in Cabarita.
