This article is from the Australian Property Journal archive
ASCOT Capital is looking to divest a $15 million portfolio of Petstock outlets it picked up two years ago, with the eastern seaboard assets going to auction next month.
Petstock, Australia’s second-largest pet retailer, had a 55% stake acquired by retail giant Woolworths in 2022 for $586 million. Petstock has 276 stores nationally and annual revenue of approximately $208 million.
The portfolio is headlined by an offering in Prahran, in Melbourne’s inner south, seven kilometres from the CBD. The property occupies a 1,206 sqm corner site with 98 metres of triple street frontage. Zoned Commercial 1, the site offers multi-storey development potential, and has a lease with provisions for early termination at the landlord’s discretion.
Currently, it generates $217,350 per annum, with rental growth potential of up to 12% annually.
Burgess Rawson’s Darren Beehag has the listings, with the regional and Prahran assets going to auction across its Sydney and Melbourne portfolio auction events on December 10th and December 11th respectively.
The portfolio includes four regional Petstock properties, in Queensland’s Gordonvale, Barham and Leeton in NSW, and Cohuna in Victoria. Each asset is leased to Petstock under long-term, 15-year agreements with 3% annual rent increases.
Beehag said these regional assets are located in growing towns, offering excellent potential for capital appreciation alongside steady income.
“Their affordability and reliable tenant profile make them particularly appealing to a range of investors. Some of these properties are also on large landholdings, for example Cohuna which comprises a massive 10,593 sqm approx. site.”
According to Burgess Rawson, yields for veterinary clinics and similar assets have compressed to 5.94%, down from 6.31% in 2023.
“At these yields, given the sector’s minimal risk profile and future strong growth prospects, these yields still represent exceptional value for the astute investor,” Beehag said.
Burgess Rawson’s previous portfolio auction achieved over $112 million in sales nationwide.
