Suburban shopping centre sells for $30m
The Coles-anchored Market Plaza shopping centre in Sydney’s South-West has been bought by a private equity trust for $30,350,000 in a deal secured by LJ Hooker Commercial Sydney
The sale of the fully-tenanted centre at Chipping Norton represents an approximate passing yield of 5.7 per cent for the purchaser. Agents James Griffith and Steven Kruyer managed the transaction. LJ Hooker Commercial Sydney also manages the centre.
The purchase of the centre, which is in proximity to the State Government’s Western Sydney Priority Growth Area, comes following a stagnant period of stagnant retail asset turnover. The value of retail asset sales dropped 17% across Sydney in 2016 compared to the previous 12 months as stock numbers dried up.
Mr Griffiths said opportunities to purchase neighbourhood shopping centres had been scarce over the past 12 months, which triggered a significant amount of enquiry for the Market Plaza.
“Market Plaza is the most convenient and comprehensive shopping facility between Bankstown and Liverpool,” said Mr Griffiths. “We worked with the seller to build a strong tenant mix. By securing Coles as the anchor, supported by a 365sqm ANZ Bank branch and 17 other speciality stores, the centre was a very attractive investment opportunity.
“Coles is on a lease until 2027 which provided added security in the purchase.”
The full-line Coles supermarket is set across 2800sqm, equating for more than half of the total 4,338sqm building’s gross lettable area. The shopping centre offers 218 on-site car spaces.
Mr Kruyer said the purchaser was pleased with the overall performance of the centre and that they are going to investigate improving shopper access and mobility around the facility for better connectivity between the businesses and the parking area. They will also investigate improvements to enlarge the shopping centre so that additional retailers can be accommodated.
The State Government is encouraging population growth in proximity to Market Plaza so the buyer wants to strengthen its accessibility for these new residents and workers.”
Mr Kruyer said he had developed an extensive database of investors seeking out neighbourhood retail assets throughout the city on circa six per cent yields.