Large regional retail centres in high demand over $40m sales

Griffith Hometown sold for $28.33m

The retail sub sector in NSW continues to show resilience as a pair of deals in regional parts of the state totalled $40m.

Late last year, over $40m was transacted via the sales of both the Dubbo Homemaker Centre and Griffith Hometown centres.

The newly built Dubbo Homemaker Centre, located on the Mitchell Highway, was purchased by MPG Funds Management in a $13.27m deal conducted via Colliers and the Stevens Group.

The commercial site in Dubbo sold for $40m late last year.

The Central West site was sold at a fully leased yield of 5.75 per cent, at a rate of $3,154 per sqm.

Spanning 4,209 sqm of lettable space, the centre is leased by a number of national retailers including Total Tools, Fantastic Furniture and OMF.

Colliers head of retail middle markets in Australia, James Wilson, said the deal was significant for the retail sector.

The commercial site spans 4,209 sqm of space.

“Colliers recorded over $1.5bn worth of Large Format Retail centre sales in 2022 through a combination of private and institutional capital targeting the asset class. This was due to the sector largely offering strategic land holdings in high growth locations with fixed annual reviews.

“Dubbo Homemaker Centre’s competitive bidding reflected the quality of the Stevens Group development in a market featuring limited NSW investment supply in late 2022.”

There were over $1.5bn in retail centre commercial transactions recorded in 2022

“We are delighted to add Dubbo Homemaker Centre to our quality portfolio of properties held within the MPG Bulky Goods Retail Trust. Compared to other property asset classes, we consider that the large format properties offer good value, and we are actively seeking to grow the Trust with the addition of new large format properties in the range of $10m to $50m,” MPG Funds Management director Brett Gorman added.
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The Griffith Hometown property has an adjoining Bunnings Warehouse.

Separately, the Griffith Hometown was sold to Argus Property Partners in a $28.33m deal late last year in a transaction negotiated by Colliers and Savills.

The retail centre comprises three freestanding buildings across 19,070 sqm of lettable area and includes a Bunnings Warehouse and some available vacant land.

The centre itself is located 2kms southeast of the Griffith CBD on a prominent 6.4 hectare corner site with frontages on Kidman Way and Watkins Ave.