Gympie sale a sign of things to come in Queensland

Queensland’s strong run of regional retail sales is showing no signs of abating, with Gympie’s Southside Town Centre sold for $28.3 million.

The neighbourhood shopping centre was sold by unlisted public company AHC Limited to an undisclosed private investor on a passing yield of 6.53%.

Savills marketed the property via an expressions of interest campaign that attracted more than 150 buyer inquiries from around the country and multiple bids.

Savills national director of retail investments Peter Tyson says high quality shopping centre investments, anchored by major supermarket tenants, in regional locations are in increasingly high demand as investors look beyond the suburban Brisbane market.

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“The sale of the Southside Town Centre continues this trend and highlights the growing demand for well-established and strongly performing retail assets in regional centres such as Gympie,” Tyson says.

Southside Town Centre opened in December 2011 and is anchored by a 3102sqm Woolworths with a 20-year lease until 2031.

The sale of Southside Town Centre is the latest in a string of key Queensland deals

The site at 1 Woolgar Rd, Southside, about 2km south-west of the Gympie CBD, also includes a freestanding Caltex service station and Star Mart, with more than 50% of the centre’s total rental income derived from Woolworths and Caltex.

Other tenants include a discount variety store and 12 specialty stores, including a medical centre and pharmacy.

The sale follows a steady stream of neighbourhood shopping centre deals in recent months, with the trend bolstered by a recent Herron Todd White report that indicated a number of the state’s larger regional cities, including Rockhampton, Hervey Bay, Toowoomba and the Sunshine Coast are starting to recover from the market downturn.

The retail investment market in Queensland has been very active and seen enormous yield compression over the last two years

Savills, in conjunction with Cushman & Wakefield, has also been marketing the Noosa Junction Plaza shopping centre on the Sunshine Coast on behalf of owner Metcash.

The Noosa centre is situated 1km from the popular Hastings Street strip and comprises an enclosed mall, anchored by a 2153sqm Supa IGA supermarket and 1360sqm Target Country store, plus 17 specialty shops.

Metcash is selling Noose Junction Plaza.

Cushman & Wakefield senior director of national retail investments Sashi Makkapati says: “We are seeing an unprecedented demand for quality neighbourhood shopping centres in the sub $25 million category across the eastern seaboard”.

“The retail investment market in Queensland has been very active and seen enormous yield compression over the last two years, with the most sought-after asset class on investor wish lists being neighbourhood retail,” Tyson adds.

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A number of other neighbourhood shopping centres on the Sunshine Coast are also on the market, including the 4044sqm Coolum Park Shopping Centre at 21 South Coolum Rd, which is anchored by a 2830sqm Woolworths.

In a high profile location adjacent to the Sunshine Motorway, the centre has a fully-leased income of almost $1.34 million per year.

Nambour Mill Village, located at 9–13 Mill St, is also being marketed by CBRE, with the centre’s fully leased net income listed as just over $2 million.

The centre, which has a gross lettable area of 6540sqm, is anchored by a Coles Supermarket with a new 15-year lease.