Dexus Convenience Retail REIT has bought a pair of service stations on the Sunshine Coast, Queensland for $21.25 million, reflecting a purchase yield of 4.9%.

The REIT acquired the Glass House Mountains Dual Service Centre properties, which were located on either side of the Bruce Highway.

The properties had a combined site area of 24,769 sqm, with current site coverage of 21%.

Both assets were anchored by Shell service stations and Hungry Jack’s restaurants, while the southbound property also had a McDonald’s restaurant, Subway and three other tenants.

The properties were also set to benefit from a proposed Surf Park adjoining the northbound site, which obtained council development approval in December 2021.

“This is a unique opportunity to acquire high-performing, prominent dual highway sites which reinforces our disciplined and opportunistic approach to acquisitions,” the REIT’s Fund Manager Chris Brockett said.

“The surplus land together with the proposed Surf Park on the adjoining property provide immediate development and value-add opportunities, which we have already made solid progress on.”

The deal was expected to settle in March 2022.

The REIT’s portfolio will grow to $834 million following the deal, reflecting a weighted average capitalisation rate of 5.8% and a portfolio weighted average lease expiry (WALE) of 11.3 years.

The deal comes after Strintzos Property Group disposed of a service station development in the Melbourne suburb of Tarneit for $19.91 million last month and Charter Hall’s retail REIT bought a 49% stake in an Ampol service station portfolio for $50.5 million last December.

Investor appetite for convenience retail assets remains strong across the country.

Last month, Singapore-based investment manager Firmus Capital sold a convenience-led shopping centre in Sydney to a private investor for $37.5 million, selling for a record 3.75% yield.

Centuria subsidiary Primewest bought a Woolworths-anchored convenience retail centre under construction in Sydney from Fridcorp for $41.5 million last December.

ASX-listed SCA Property Group and Singaporean sovereign wealth fund GIC teamed up in December last year to create a $750 million joint venture to invest in Australian metropolitan convenience retail centres.


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