This article is from the Australian Property Journal archive
A LALOR mixed-use centre, Mosaic Village, has this week seen the sale of retail assets for a combined $2.6 million, as well as the $4 million plus sale of a childcare asset.
Strata-titled retail assets with long leases in Melbourne continue to draw the interest of investors, as four shops in Mosaic Village sell for a combined $2.6 million.
The four shops in Mosaic Village shopping centre at 53 Mosaic Drive in Melbourne’s suburb of Lalor, 18km north from the city’s CBD and within the northern growth corridor, range in size from 54sqm to 101sqm.
Chris Kombi and Ervin Niyaz of Fitzroys managed the sale of the retail assets, which sold at an average yield of circa 5%, within a two week period, each to SMSF investors.
“Investors remain on the look-out for assets with secure income during the uncertainty of the COVID era, while the Reserve Bank has flagged interest rates will remain at their historical low for some time, and the share market presents volatility,” said Kombi.
Each store had a long term lease, with Shop 2 leased to Old Socks Laundrette for 7+5-years, Shop 9 lease to Fatwraps for 7+7 years, Shop 3 leased to Lord of Dough for 5+5+5-years and Shop 6 leased to Mosaic Convenience Store for 10+5+5-years.
Kombi noted that these sales represent investor appetite for passive, well leased assets, further driven by historic low interest rates, with strata-titled properties presenting as a simpler management offering.
“Over the past 12 months we’ve seen a rush of enquiry from SMSF investors preparing for their retirement, or retirees wanting to buy a property that will immediately improve their income,” said Niyaz.
Niyaz predicts that this growing market segment will continue on this trajectory, as long as the current conditions prevail.
Meanwhile the sale of the property at Level 1 of 53 Mosaic Drive, on a 15-year lease to Nino Early Learning Adventures, has brought CBRE’s healthcare and social infrastructure team to nearly $115,000,000 in premium childcare transactions since 2017.
The transaction of the first-floor strata facility, which is leased to 2033 plus options to 2048, was managed by Sandro Peluso, Josh Twelftree, Jimmy Tat and Marcello Caspani-Muto of CBRE.
“This is the 13th consecutive Nino Early Learning Adventures sale handled by our team. The lease covenant is always well received by investors as are most premium early learning offerings, meaning an established proven with multiple centres and a proven track record of success,” said Peluso.
The centre is among other Nino Early Learning Adventures locations in Ashburton, Blackburn North, Bundoora, Elsternwick, Footscray, Ivanhoe, Lalor, Malvern East Melton, Mickleham, Montmorency, Newport, Point Cook, Preston and Saratoga Estate and was sold for an undisclosed price, reflecting a yield of circa 6%.
“This child care sale represented a unique price point of $4m+ and as a result drove increased enquiry above and beyond a number of more traditional offerings which can fall anywhere north of $6m, this really meant the opportunity fell within a wider spectrum of investors capacity’s,” said Twelftree.
“It is rare to see a childcare centre at this price point come to the market with such a quality operator.” he concluded.
