Supermarkets continue performing as Coles sells two in NSW
Supermarkets are proving to be the hardiest part of the shopping centre industry with Coles selling successfully selling off two centres in NSW for a total of almost $45 million.
The performance of department stores is hitting larger shopping complexes and fashion chains are also under pressure but supermarkets are still winning strong investor interest.
Coles sold the two neighbourhood shopping centres via Colliers International. The company sold Willowdale Shopping Centre, a new centre in Sydney’s south western suburbs for $34.8 million and Coles Mayfield, a development site in Newcastle, for $8.9 million.
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The Willowdale complex was snapped up by a NSW private investor, on a fully leased yield of 5.62%, after a campaign by James Wilson and Alex James-Elliott of Colliers International.
Wilson and Chris Chapman of Colliers International sold Coles Mayfield to a local investor, with the transaction reflecting a land rate of $63 per square metre across the 1.4-hectare site.
“We are seeing an exceptional depth of the market with an extremely solid appetite for strong performing retail assets within capital city locations, with interest in assets featuring income secured by national non-discretionary retailers, such as the highly prized Coles supermarket covenant,” Wilson says.
The Willowdale centre is fully leased with a weighted lease term of more than 11 years and is anchored by a Coles and Liquorland. The majority of tenants in the centre are on fixed 4% annual rental review mechanisms, offering strong income growth potential, as it is near the Badgerys Creek Airport.
The Coles Mayfield development site is near the Newcastle CBD, which has undergone a major transformation driven by strong population growth, an expansion of major industries.
This article originally appeared on www.theaustralian.com.au/property.
