LOW YIELD IN GOLD COAST SUPERMARKET SALE

LOW YIELD IN GOLD COAST SUPERMARKET SALE
WOOLWORTHS-anchored Reedy Creek Village Shopping Centre has sold for $20.5 million to a local investor on an yield of 5.9 per cent.

The sale was conducted by Stewart Gilchrist of Colliers International, together with Nigel Smith of Burgess Rawson and Leonie Smith of Smith Commercial.

The buyer was a family, with members based both on the Gold Coast and in Asia.

Supporting Woolworths are six specialities including BWS, Zarraffa's Coffee, Goldsteins bakery, a medical centre, hair salon, sushi bar and an ATM.

Gilchrist, who promoted the centre off market on behalf of a Gold Coast family developer, said a number of factors contributed to the yield.

"The centre is located in a fast growing neighbourhood and is 83 per cent occupied by Woolworths on a long term lease, until 2031.

"The yield on the sale was a crisp 5.9 per cent, reflecting the strong demand for supermarket based retail investments, especially where they are relatively new and contain long term covenants.

"There is still a very strong level of demand for shopping centres which is likely to continue given the ongoing sentiment of lower interest rates.

"Construction of new centres is rare with development projects very limited throughout Queensland. The demand is outpacing the supply, with not enough centres available on market for investment."

According to JLL's Australian Shopping Centre Investment Review and Outlook, released in February, the yield range for sub-regional centres in Australia was wide, at between 5.75 and 8.75 per cent and is on a downward trend.

"Transaction evidence that emerged between September and December 2015 showed sub-regional yields of between 5.75 per cent and 6.25 per cent, confirming a downward shift in yields for premium and mid-tier sub-regional centres," says the report.

 

Reedy Creek Village is located on Old Coach Road in Reedy Creek opposite the M1 Highway, on a 1.22ha site and features 3,279sqm of net lettable space with 192 car spaces.


 

Get our daily business news

Sign up to our free email news updates.

 
Unpacking equity: Finding your funding fit
Partner Content
Armed with a growing business and a great opportunity, a business owner’s next challe...
Australian Business Growth Fund
Advertisement

Related Stories

Meta slammed over "dereliction" of commitment to Australian news

Meta slammed over "dereliction" of commitment to Australian news

The decision by Meta (NASDAQ: META) to "deprecate" the Fa...

AF Legal acquires Armstrong Contested Wills & Estates in deal worth up to $3.75m

AF Legal acquires Armstrong Contested Wills & Estates in deal worth up to $3.75m

A year on from the failure of an $11 million merger with Go to Cour...

Childcare veteran Chris Scott scaling up Embark Early Education with $25m acquisition

Childcare veteran Chris Scott scaling up Embark Early Education with $25m acquisition

Embark Early Education (ASX: EVO), a Gold Coast-based childcare cen...

ASIC tips ‘ASX Wolf’ Tyson Scholz into bankruptcy over $500,000 in court costs

ASIC tips ‘ASX Wolf’ Tyson Scholz into bankruptcy over $500,000 in court costs

Social media ‘finfluencer’ Tyson Scholz, widely known a...