Best & Less sells Leichhardt HQ for 644% windfall
One of Australia’s largest clothing retailers has offloaded its national headquarters in Sydney for $4 million above expectations.
Best & Less who operate 194 stores around the country fetched $29 million from an unknown investor for its 6265sqm site in Leichhardt.
It marks a 644% return on the $4.5 million that the outfit owned by Value Retail Group paid in 1998 to acquire 657-673 Parramatta Rd, according to CoreLogic.
The inner west property first came to market at the start of February before the COVID-19 pandemic, and was the subject of 144 inquires and 16 formal offers totalling $384.475 million.
The 6265sqm landholding has been owned by Best & Less since 1998.
The Parramatta Rd complex was offered to buyers as a sale and lease back opportunity that would see Best & Less rent its long-term headquarters for a minimum period of three years at $1.3 million per annum.
It was sold by James Cowan and Matthew Meynell of Colliers International, who said in a statement the property sold at a passing initial yield of 4.63%.
“This leaves more than $350,000,000 of unplaced capital for middle markets office and warehouse accommodation in this market.”
The strong sale comes after Best & Less knocked back a number of off-market offers in past several years from developers after a substantial landholding close to the Sydney CBD.
The modern office complex has a 5-Star NABERS rating.
The rear of the office.
Expected to be rezoned as B4 mixed use with a 2:4:1 floor-space ratio, the Best & Less complex offered buyers the long-term possibility to acquire a large landholding that could later be converted into apartments.
Under the proposed rezoning, the new owner would have the potential to construct apartment towers up to 21m high on the landholding.
Similar sized developments behind the Best & Less site on George St have yielded a combined 386 apartments between Oasis Leichhardt and Leichhardt Green sites.
A rooftop terrace.
Under their ownership, Best & Less has added surrounding blocks to its land parcel. The site includes a renovated commercial office, two warehouses and an outdoor car park for 65 cars now spans two sides of Upward St.
Unrelated to COVID-19 pandemic, the sale comes at a time when many retailers have either closed their doors or struggle financially.
This article from The Daily Telegraph originally appeared as “Australian retailer Best & Less offloads Leichhardt head office for $29 million”.
