The 7-Eleven mega-sale: Burgess Rawson offers sites worth $70m
Investors will be lining up at the Burgess Rawson auction where more than 30 properties, ranging from 7-Eleven outlets to supermarkets and childcare centres, are tipped to generate about $130 million combined.
High-net-worth individuals, self-managed super funds and smaller private buyers will dominate the sales as they look to invest in higher-yielding bricks and mortar with solid rental income amid a low interest rate environment.
Convenience and fuel retail billionaire Russell Withers’ 7-Eleven group will lead the charge, with the sale of 15 key properties around the country in a one-day auction event that may net $70 million for the portfolio.
The prominent 7-Eleven sites will be sold by portfolio auction specialist Burgess Rawson at live-linked events in Sydney and Melbourne on Wednesday, October 30.
They include sites at Liverpool and Clyde in Sydney, Mornington and Campbellfield in Melbourne, Braddon in the ACT and Ellenbrook in Perth.
Each of the properties has a new 12-year lease to the fuel and convenience sector’s most desirable tenant, with annual rents starting from $147,215. They will be auctioned individually, back to back.
The 7-Eleven owner has been undertaking a significant sell-down of its asset base over the past few years, recycling the cash into new developments. It controls about 38 per cent of Australia’s fuel and convenience market through its network of 700 corporate and franchise outlets.
Burgess Rawson director Raoul Holderhead said that of the 132 portfolio auctions the agency has held, this month’s may represent the strongest.
“I’d argue it’s probably our best list yet,” Mr Holderhead said. “We’ve got some great stock at a range of different price points.
“There are some big-ticket items for the high-net-worth investors, with the Woolworths and the First Choice, but there’s also some great buying for mum and dad investors in the low $1 million range.”
The 7-Eleven sales come as Caltex Australia has engaged CBRE and Stonebridge to put 25 properties to market in the first tranche of a 50-property divestment.
Other prominent properties will include a Woolworths supermarket in Seymour and a large-format Coles-leased liquor store in Werribee, both in Victoria. Agents say it’s as strong a portfolio as they’ve seen.
Four childcare centres, a KFC, medical facilities, retail properties, a Bupa dentist and a major Coles-anchored regional pub add to the substantial catalogue of properties up for grabs.
In a separate sale, a property that is home to Officeworks and Orange Theory Fitness at 640 Military Road, Mosman, has been listed through Stonebridge, with price expectations of about $15 million.
Philip Gartland, a Stonebridge director, said the building was one of only a few larger properties in the prime Mosman retail precinct, and it benefited from outstanding frontage and prominence and rare rear loading facilities.
“I expect investors will be very attracted to the site as an outstanding retail investment, with strong fixed rental increases and guaranteed cash flow,” Mr Gartland said.
The site also has development potential, with a flexible B2 Local Centre zoning and a 2.5:1 floor space ratio and 15-metre height limit.
