This article is from the Australian Property Journal archive
A PRIVATE investor has snapped up fund manager Clarence Property’s Ormeau Marketplace for $34 million, in one of the first single asset neighbourhood shopping centre transactions since interest rate hikes began.
Anchored by a 4,100sqm full-line Woolworths, the 4,700sqm shopping centre, sitting around 35km north of the Gold Coast CBD and 45km south of Brisbane, includes six non-discretionary based retailers, with a focus on both allied health and medical offerings.
Joe Tynan and Michael Hedger from CBRE, alongside Sebastian Fahey and Nick Willis from JLL, managed the sale, bringing in a yield of 5.24%.
“The quality of this asset attracted both onshore and offshore investor interest during the competitive off-market process, with the successful purchaser having a portfolio of similar assets across Australia,” said Tynan, director of retail investments at CBRE, Australia.
“The sale of Ormeau Marketplace demonstrates the continued focus from groups seeking to invest in this asset class as a hedge against inflation. These neighbourhood centres, where the income is derived from non-discretionary retailers, can benefit from income growth via higher productivity and sales growth in an inflationary environment.”
The South East Queensland centre offers a secure income profile for its new owner, providing a 11.5-year WALE and the Woolworths, which provides 87% of the centre’s income, on a 20-year term not expiring till 2035.
“The asset represents a very defensive income profile due to the limited specialty risk and the long-term leases, and is strategically positioned to capture the growing population within the northern Gold Coast corridor with the Main Trade Area to grow 21% by 2026,” added Fahey, executive of retail investments at JLL, Australia.
“While the increasing cost of debt has caused some uncertainty with investors, we are still experiencing strong demand for quality prime convenience-based assets in tightly held locations.”
For Clarence Property, the sale follows the group’s recent name change of its $720 million flagship fund, Westlawn Property Trust, to Clarence Property Diversified Fund (CPDF).
With the fund’s recent activity including the acquisition of the additional 50% interest in The Rocket in Robina, a development site set aside for a 5,000sqm office building and four long leased childcare centres. Bringing CPDF’s total portfolio up to 48 assets.
