Gold Coast family sells Reedy Creek Village to Asian buyer
An Asian investor has snapped up the Woolworths-anchored Reedy Creek Village Shopping Centre, on the southern end of the Gold Coast, for $20.5 million on a record low yield.
Stewart Gilchrist of Colliers International, who marketed the centre on behalf of RCSC Pty Ltd, which is associated with Gold Coast developers the King family, says a number of factors contributed to the yield of 5.9%.
“The centre is located in a fast-growing neighbourhood and is 83% occupied by Woolworths on a long-term lease, until 2031,” Gilchrist says.
“The yield on the sale was a crisp 5.9%, reflecting the strong demand for supermarket-based retail investments, especially where they are relatively new and contain long-term covenants.”
“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.”
Reedy Creek is a residential neighbourhood bordered by Varsity Lakes and Mudgeeraba, which itself was heralded earlier this year as one of the Gold Coast’s most active emerging commercial precincts.
It is understood that the buyer of Reedy Creek Village was a family, with members based both on the Gold Coast and in Asia.
Herron Todd White says in its August 2016 Month in Review report: “Retail continues to be the Gold Coast’s strongest performing commercial property sector and the appetite of investors is showing little sign of waning.”
“The constant feedback we are receiving from purchasers and selling agents alike is the extreme difficulty in securing good quality investment stock.”
Meanwhile, according to JLL’s director of Queensland retail investments Jacob Swan, the number of opportunities to acquire neighbourhood shopping centres has reduced in 2016 compared with previous years, as fewer assets have been offered for sale.
“This limited stock has been reflected in lower transaction volumes of neighbourhood centres in the year to date nationally, which are down 64% on the same period in 2015. Queensland has fared better, down just 37% on the previous year,” Swan says.
JLL was recently appointed to negotiate the sale of Yamanto Shopping Village, near Ipswich, about 35km south-west of the Brisbane CBD, on behalf of Shayher Group.
Yamanto Shopping Village is a single-level, 12,410sqm neighbourhood shopping centre anchored by a Woolworths supermarket and Super Amart and supported by two mini-majors – Super Cheap Auto and Priceline – and 22 specialty tenants.
The Reedy Creek deal was brokered by Colliers International in conjunction with Nigel Smith of Burgess Rawson and Leonne Smith of Smith Commercial.
Reedy Creek Village is located on a 1.22ha site on Old Coach Rd in Reedy Creek, opposite the M1 Highway, and features 3279sqm of net lettable space with 192 car spaces.
Supporting the strong performing Woolworths are six specialities including BWS, Zarraffas, Goldsteins bakery, a medical centre, hair salon, sushi bar and an ATM.