This article is from the Australian Property Journal archive
A RECENTLY-built service centre on the outskirts of Melbourne has sold for $11 million, while ASX-listed Vicinity Centres has offloaded another fuel station adjoining one of its western suburbs shopping centres.
Anchored by 7-Eleven, the Melton South Service Centre is on a 5,108 sqm landholding with shops that also includes Ultra Tune and Soak City Car Wash.
The sale price of $11,111,000 realised a 6.39% yield.
Stonebridge agents Rorey James and Kevin Tong sold the property on behalf of a private developer.
The expressions of interest campaign culminated in three second-round contracted offers – two of those via the agency’s Asia practice – with larger price point of the service centre pricing out traditional petrol station investors. It eventually sold to a local investor who is already invested in the Melton South area.
“Given the number of shops and price point, we feel the 6.39% yield is a strong result in the current market” James said.
The Vicinity Centres asset, an EG Fuel Service Station in Altona North adjoining its Altona Gate shopping centre, sold for $3.12 million, through James, Tong and colleague Justin Dowers.
The fuel station has a ground lease structure that expires this year, which Tong said provided an abundance of flexibility to release the asset at a market rent or occupy the petrol station. It attracted interest from a mix of investors, owner occupiers and developers and 15 formal bids, and was ultimately purchased by a local owner occupier who will have the option to operate their own business out of the site or negotiate a new lease to a petrol station operator.
The sale price showed a sharp yield of 2.64%.
“Prime located petrol stations remain popular amongst investors, especially those who have an abundance of vehicle traffic. In the case of EG Fuel Altona North, being directly opposite to one of Vicinity’s major shopping centres was a key benefit to ensuring the site will always remain highly trafficked,” the Stonebridge agents said.
At last week’s Burgess Rawson portfolio event, an investor paid $7.985 million for the brand-new 2,687 sqm Ampol service station and Oporto restaurant site in Caboolture, with the sale price realising a 6.07% yield. The property has general residential – urban neighbourhood zoning that may allow for up to seven levels, but for now the property has a 12-year lease to EG Group, with five further five-year options.
