Woolworths Group has sold the Sapphire Marketplace shopping centre in Bega, New South Wales to a private investor for $54.05 million, representing a 6.5% capitalisation rate.
The sub-regional shopping centre comprised 15,327 sqm of retail and 1,983 sqm of office space in the Bega town centre.
The property was anchored by a Woolworths supermarket, Dan Murphy’s liquor store and Big W discount department store, providing a major tenant weighted average lease expiry (WALE) of 8.4 years.
CBRE said it was the only sub-regional shopping centre within the surrounding trade area, with the closest sub-regional shopping centre located in Batemans Bay – about 145km north.
CBRE’s James Douglas negotiated the sale on behalf of Woolworths Group.
“The public sale process for Sapphire Marketplace drew strong interest from institutional and private capital sources,” Douglas said.
“There is no shortage of demand for quality sub-regional assets, given the current yield spread relative to neighbourhood shopping centres.
“Given the tight pricing being achieved for neighbourhood centres, we have seen astute investors tailor and adapt their investment strategies to target high-quality sub-regional shopping centres, which feature a strong major tenant profile and a sustainable number of specialty retailers with a focus on non-discretionary spending.”
According to the firm, the main trade area population of 39,630 residents benefitted from significant annual tourism within the Bega Valley Shire, with spending estimated at $424 million in 2019.
The centre was expected to benefit from a strong MTA retail spending capacity of $647.1 million, projected to increase to $990 million by 2036, with food retail and food catering expenditure growth of 3% and 3.5% per annum respectively, according to LocationIQ.
The deal comes after a private investor bought the Woolworths-anchored Fernvale Village shopping centre, located an hour west of Brisbane, for $35.55 million last week.
Recent regional retail property deals include Charter Hall Direct Industrial Fund No.4’s purchase of a Bunnings warehouse in Nowra on the south coast of NSW for $65.3 million last month.
In January this year, Stockland and AMP Capital disposed of the Coles Kmart Plaza in Townsville, Queensland to a Sydney-based investor syndicate for $47.25 million.
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