Queensland-based retail investors Daniel and Kylee Burke have purchased Poinciana Place Shopping Centre in Tewantin on the Sunshine Coast for $17.5 million.
The fully leased 3,104sqm neighbourhood shopping centre is anchored by Woolworths supermarket, representing 77% of the gross lettable area (GLA) and 57% of income.
The centre comprises an additional nine non-discretionary retail tenants.
The Burke family are known for their value-add initiatives with retail property in the SEQ markets which are displayed in the expansion and repositioning they undertook of the successful Woolworths anchored Camp Hill Marketplace.
CBRE’s Joe Tynan, Michael Hedger and Louisa Blennerhassett conducted the on-market Expression of Interest campaigns with Vinci Carbone’s Frank Vinci as transaction advisor.
“The sale achieved a 5.49% yield, which represents a very strong result in light of the market volatility, short WALE and requirement for immediate cap ex,” Mr Tynan said.
“It was a competitive EOI process, we received 160 enquiries resulting in eight formal bids. In the final round there were three bids around the same price with the top party selected on their terms and capacity to complete in a short timeframe.”
“Investors were attracted to Woolworths which is currently generating sales 14% above the Urbis average and paying percentage rent. Woolworths is further supported by a national tenancy profile that represents 83% of the gross passing income.”
The family’s acquisition of Poinciana Place gives the opportunity to largely replicate the strategy used in driving the success of Camp Hill Marketplace.
Mr Hedger said the transaction followe the recent sale of Woolworths Mountview, which changed hands for $35.2 million, achieving a yield of 5.27%.
“CBRE continues to achieve strong results in the retail neighbourhood sector space as we target the most aggressive private capital in the market seeking quality investments,” Mr Hedger said.
“Pricing for neighbourhood shopping centres appears to be holding up better than other asset classes in the current higher interest rate environment.
“The key reason is the smaller transaction size which is attractive to private investors who may not require any debt.
“Also, supermarkets have been resilient with sales generally increasing with inflation which drives income for these assets.”