The Hamilton IGA sold for around $3.2 million.An offshore buyer has swooped on Woodend’s 19th Hole shopping centre, paying nearly $18 million despite only 28 months remaining on a lease to anchor tenant Coles.
The Chinese buyer was prepared to go higher than local syndicates and institutions put off by the Coles lease that expires in February 2019.
But that did not stop them from looking. Colliers International agent Tim McIntosh, who negotiated the deal with Tom Noonan, said there was a lot of interest in the centre, with more than 150 enquires fielded from investors.
“It all depends on how much risk people are willing to take on. There’s not that many opportunities in the market and on that basis they were looking at this asset,” Mr McIntosh said.
“As part of the sales process, we approached other supermarket groups to gauge their interest in back filling the space and we’re talking to a couple of groups.
The 8491 square metre shopping centre returns $1.48 million a year in rent from 18 specialty shops and a host of mini-majors including Mitre 10, Target Country and Ian Marks Liquor.
The deal reflected a yield of just over 8 per cent although it’s closer to 5.11 per cent if the Coles proportion of the income is excluded.
Elsewhere in regional Victoria, local private investors edged out off-shore investors to buy two IGA supermarkets on very sharp yields around 6 per cent.
The IGA in Hamilton, in the Western District, fetched around $3 million and was part of the freehold portfolio controlled by Alan Fisher, who last year sold his portfolio of country supermarkets to Ritchies. It has a new 15-year lease.
The Kyabram IGA is understood to have sold for around $4.2 million. The deals follow the recent sale of the Nagambie IGA, to a Chinese buyer, for $8 million.
The deals were struck by CBRE agents Joseph De Rieu and Justin Dowers who received nine formal offers.
“The IGA in Hoppers Crossing was sold this year at 5.3 per cent and the one at Wantirna South was done at 5.5 per cent so the Hamilton store is only 50 basis points behind them – that’s not a big difference,” Mr De Rieu said.
This story Administrator ready to work first appeared on Nanjing Night Net.