Source : THE AGE NEWS
Private investors have headed out of the city to the regions to snap up close to $110 million worth of assets, from Bunnings hardware stores to petrol stations and childcare centres, that offer better yields in the low-interest rate environment.
Charter Hall’s unlisted Direct Industrial Fund No.4 (DIF4) has led the charge, paying $65.3 million for Nowra’s Bunnings warehouse, with a net lease of 12 years and an initial passing yield of 4 per cent.
The fund’s manager, Julian Menegazzo, said the acquisition of Bunnings Nowra is in line with DIF4’s strategy to invest in “quality properties in premium locations with high capital growth potential and long-weighted average leases”.
Charter Hall paid $65.3 million for the Bunnings at 129 Princes Highway, South Nowra.
JLL’s joint head of retail investments (Australia), Sam Hatcher and Nick Willis, brokered the retail asset at 129 Princes Highway, South Nowra on an off-market basis to Charter Hall.
At the first of the Burgess Rawson auctions for the year in Sydney, $39.6 million of deals were concluded on a blended yield of 5.68 per cent, equal to a clearance rate of 88.88 per cent.
Burgess Rawson partner in Sydney, Rhys Parker, said enquiries came from 40 people in the room and more online, and the auction “filtered down to an estimated registered buyer pool of $210 million”.
The highest sales were the Alby hotel in Canberra for $8.3 million on a yield of 5.3 per cent, followed by the North Boambee Valley car yard for Audi, Land Rover and Skoda, which sold for $6.9 million on a yield of 5.17 per cent.
In Picton, south-west of Sydney, a childcare centre was snapped up for $3.29 million, while in Tweeds Head on the northern coast a United Petroleum petrol station sold for $3.9 million on a yield of 5.38 per cent.
Burgess Rawson chief executive Ingrid Filmer said over the past two years, investors have embraced a new way of purchasing, and she is confident the trend is “here for the long term”.
“Transactions in 2021 have demonstrated ongoing investor confidence in high-quality, essential service assets. Not only were investors comfortable bidding at auction via phone or online, but we also saw a high number of cross-border transactions and deals made sight unseen,” she said.
“Community lockdowns and restrictions did not deter investors who could not physically inspect a property. Instead, reputable tenants, secure leases, and the ability to trade through was too compelling. The confidence in essential service assets will prevail.”
Investors are tipped to be out in force for the Melbourne auction on Wednesday, February 23, where the main sale is a portfolio of three National Tiles showrooms, with the flagship site on Whitehorse Road, Mitcham. The properties are offered in a sale and leaseback deal by founder Frank Walker. These are expected to sell for about $19 million combined.
There are also childcare centres in Sunbury, Seaford and Ormond and an IGA shopping centre at Fraser Rise in Melbourne’s north wests.
