Private investor pays $17m for Woolworths-anchored mall on Mornington Peninsula
A local private investor has paid almost $17 million for a Woolworths-anchored neighbourhood shopping centre on Victoria’s Mornington Peninsula with the property trading on a 5.6 per cent yield.
The 4218-square-metre Baxter Central Shopping Centre on Baxter-Tooradin Road includes a BWS liquor store and six speciality shops. It was offloaded by a Melbourne investor trading as A.L. Development Company for $16.6 million in an off-market transaction.
Neighbourhood shopping centres anchored by non-discretionary retailers such as Coles and Woolworths and freestanding supermarkets themselves have become highly sought-after by investors with yields tightening across the board.
In April, private syndicator Henkell Brothers Investment Managers paid $32.1 million for the Hastings Central Shopping Centre, on the Mornington Peninsula, on a 6.2 per cent yield.
Selling agents Stuart Taylor and Stephen Bolton of JLL said the sale continued a theme of Victorian neighbourhood centres selling on yields below 6 per cent.
“Investors are gradually resetting their return expectations to reflect a lower growth and lower return environment,” Mr Taylor said.
Mr Taylor said the acquisition of Baxter Central by a local private investor went against the recent trend of offshore investor activity.
“The strong result for the asset in an off-market sale reflects the weight of demand and punching power of local investors as many try to gain a position in the tightly held market,” he said.
Neighbourhood shopping centres were the most commonly traded retail property in Victoria last year, according to JLL. However, transactions have slumped this year with just $86 million worth of deals in the first quarter of the year due to a lack of offerings in the market.
Last month, the Woolworths-anchored Arena Shopping Centre in Officer in south-east Melbourne sold for $48 million on an initial yield of 5.4 per cent yield to mainland Chinese investors.
