This article is from the Australian Property Journal archive
WOOLWORTHS has sold recently constructed neighbourhood shopping centre in the Illawarra-Shoalhaven region to a Victorian investor, which was snapped up prior to its public marketing campaign for $40 million.
Woolworths Bomaderry shopping centre traded on a fully leased yield of 5.43%.
Constructed in 2020 by Woolworths Group’s development arm Fabcot, the 4,200 sqm Woolworths and BWS is supported by a gym, medical centre, pharmacy and four other specialty tenants, and serviced by a car park.
The centre is the only full-line supermarket in the primary catchment.
Colliers’ James Wilson and Ben Wilkinson struck the deal. They said Woolworths Bomaderry Shopping Centre is only the third NSW non-metro neighbourhood shopping centre sold in 2023 so far, reflecting the limited supply of high-quality shopping centre opportunities, as well as the high demand from domestic and offshore private capital when they come to market.
The result shows the sharpest yield paid for a NSW neighbourhood shopping centre in 2023, and reflected the “incredible Woolworths supermarket performance and dominance in the catchment”, Wilson said.
Wilkinson said that with Woolworths securing 77% of gross lettable area of the fully leased shopping centre, the high profile offering required minimal management, aligning with the predominantly private capital target purchaser mandates,
The centre has a site area of 19,140 sqm and a gross lettable area (GLA) of 5,451 sqm, featuring a weighted average lease expiry of 8.4 years by GLA. The fully leased net income is over $2.171 million per annum.
Woolworths Bomaderry Shopping Centre holds a prime position within the town and enjoys excellent exposure to the Princes Highway, the main route along the South Coast of New South Wales linking Sydney to Melbourne.
Shopping centre transactions – including deals from neighbourhood centres to sub-regionals – froze during winter, despite more than 400,000 sqm of retail space being placed to the market, as the gap between the expectations of buyers and sellers widens. According to the Data App, deals that have gone through have been dominated by non-discretionary, supermarket-anchored retail assets.
This week, the first metropolitan Sydney supermarket to be formally offered to the market was put up for grabs. Greenacre Village Shopping Centre is expected to attract interest from private, institutional, and offshore investors as freestanding Coles and Woolworths-anchored opportunities in Sydney remain scarce.
