This article is from the Australian Property Journal archive
COLES-anchored Scone Village, in the Upper Hunter region, will be the first non-metropolitan NSW neighbourhood shopping centre to be publicly marketed in 2024.
Scone Village occupies a strategic 8,878 sqm site in the town’s CBD, and provides 4,111 sqm of gross lettable area with a Coles supermarket and an additional 11 predominantly essential service specialty tenancies.
The centre was acquired by the local syndicate in 2015, which during their ownership have actively repositioned the centre, including a refurbishment that has driven the Coles to be the dominant supermarket within its main trade area, in addition to attracting strong retailers including Discount Drug Store, Kaisercraft and Icebox Liquor.
Colliers’ agents James Wilson and Ben Wilkinson have the listing, with price expectations at $20 million.
They are anticipating strong buyer interest from predominantly private investors and funds for Scone Village Food Emporium, given the centre’s strong fundamentals are rarely offered at such a low price point, Wilson said.
“Centres anchored by supermarkets paying turnover rental are scarcely publicly marketed, with the last NSW non-metro convenience retail centre to be publicly marketed paying turnover rental being back in 2022.”
Scone Village Food Emporium allows for future positive rental reversion, with average specialty rents 40.9% below the 2023 Urbis benchmark. Wilkinson said there is further ability to drive value through centre expansion and capital improvements, such as the implementation of solar.
The centre has street frontage along Kelly Street, which connects the town to the New England Highway.
The retail spending profile of the main trading area reflects an annual growth rate of 3.1% per annum, projected to reach $406.1 million by 2041. The nearest neighbourhood shopping centre nearest is 25 kilometres away.
Expressions of interest closes Wednesday, 5th June.
Retail remained the most traded commercial asset class in the first quarter of 2024. Colliers data showed $916 million worth of retail assets was traded in the March quarter, outpacing other commercial property sectors by at least $189 million.
In January, the recently constructed Coles-developed Huntlee Shopping Centre in the Hunter Region was sold for $33 million to a Sydney based private investor.
Momentum in the neighbourhood shopping centre picked up nationally during the March quarter. Woolworths-anchored Victorian Wyndham Vale Square and Drouin Central sold to private investors for a combined value of over $45 million, while Coles Group listed the 2021-completed Andergrove Village Shopping Centre in Queensland’s Mackay for sale, and the construction arm of rival Woolworths put up for sale a neighbourhood shopping centre in Clarkson, north of Perth that was formerly a Bunnings Warehouse.
