Retail chain Coles Group has sold Ormeau Village on the Gold Coast to an offshore private investor for $37 million on a tight passing yield of 5.3%.
Coles Group Property Developments developed the neighbourhood shopping centre, comprising 5,003 sqm of gross lettable area, in 2019.
The fully leased neighbourhood shopping centre was anchored by a 3,416 sqm Coles Supermarket incorporating Liquorland, plus 16 specialty tenancies and a weighted average lease expiry (WALE) of more than 8 years.
The deal continued a strong run of neighbourhood shopping centre transactions in Queensland, including the $46.5 million sale of Westpoint Shopping Centre in Browns Plains in February and the $34 million sale of Ormeau Marketplace last September.
Savills’ Peter Tyson and Jon Tyson transacted the deal on behalf of Coles Group Property Developments following an Expressions of Interest sale process.
Savills National Director of Retail Investments Peter Tyson said Ormeau Village transacted after attracting significant domestic and offshore buyer enquiry and bids from eight separate buyer groups.
“Bidders in the process included institutional and private investors as well as syndicate funds and totalled around $300million in unsatisfied capital still seeking a quality neighbourhood retail asset, preferred for its resilient qualities underwritten by daily-needs and essential service businesses,” Peter Tyson said.
“Buyers were attracted to high quality of the development, together with the long WALE security of the income stream underwritten by a rare net lease to Coles for a new 10-year term which included potential benefits from forecast supermarket sales growth within a reasonable timeframe coupled with strong catchment fundamentals of affluent young family households in a high growth inter-city corridor between Brisbane and the Gold Coast,” Jon Tyson said.