This article is from the Australian Property Journal archive
RETAIL giant Woolworths has offloaded a fourth neighbourhood centre anchored by one of its supermarkets in a matter of weeks, netting $35.2 million for Mountview Shopping Centre, south west of Brisbane.
An offshore investor has bought the recently constructed 4,981 sqm neighbourhood centre, which 27 kilometres from the CBD and anchored by a Woolworths supermarket, which occupies 3,846 sqm, representing 77% of the gross lettable area.
It traded on a yield of 5.27%.
The deal comes hot on the heels of Woolworths offloading three neighbourhood shopping centres in south east Queensland and Melbourne earlier this month. Dakabin Shopping Centre, north of Brisbane, sold for $40 million on a 5.55% yield and Bannockburn Village Shopping Centres, between Brisbane and the Gold Coast sold for $26 million on a 5.52% yield, while in Melbourne it sold the 6,051 sqm Cranbourne West Shopping Centre for $41.8 million, at 5.36%.
CBRE’s Michael Hedger, Joe Tynan and James Douglas brokered the Mountview Shopping Centre sale, as well as the Dakabin and Bannockburn Village deals.
Another Woolworths-anchored centre, Westpoint Shopping centre in south Brisbane, sold earlier this year for $46.5 million, on a 5.44% return.
“Investor demand in the private sector continues to build momentum, particularly for newly built assets as buyers take into consideration the replacement value of centres given the rising construction costs,” Hedger said of the Mountview Shopping Centre sale.
Nine formal bids were put forward and four groups made offers close to the final price.
Tynan said the purchaser was attracted to the proposed greenfield residential and commercial developments within the surrounding area, with the moving annual turnover retail expenditure expected to increase by 4.8% per annum until 2041.
Neighbourhood shopping centres have been among the few retail assets to change hands lately, as the US banking crisis and the discrepancy between the bid and offer spread for assets have brought activity in the sector to a virtual standstill.
Trend cap rates across the entire sector have surged by 218 basis points, from 5.12% to 7.3%, but this has been driven by sub-regional and larger asset transactions.
In other recent neighbourhood shopping centre deals, Woolworths’ arch-rival Cole sold the 5,743 sqm Schofield Village in Sydney’s outer north west for $53 million, at 5.5%.
