Investors take long-term view on Queensland retail

Queensland’s shopping centres remain hot property amongst investors looking to outmanoeuvre stiff competition and yield compression in the southern states.

According to JLL’s recent Australian Shopping Centre Investment Review and Outlook, this trend looks likely to continue into 2016 as investors continue to take a long-term view on the Queensland economy, as reflected in the high levels of investment activity.

Queensland’s investment activity was amongst the nation’s strongest last year, accounting for $2.3 billion and only ranking behind New South Wales with $2.7 billion.

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“The state’s economic performance has waned as mining investment slowed but given strong competition and yield compression in New South Wales and Victoria, buyers have sought assets in Queensland as a more opportunistic long-term strategy,” the JLL report says.

JLL director of Queensland retail investments Jacob Swan adds that neighbourhood centres in South East Queensland, in particular, have experienced strong investor interest due to their accessibility to an active private investor and institutional market driven to the attractive yields and lower exposure to discretionary retail spending.

Buyers are clearly taking a long-term view on the Queensland economy, as reflected in the very high levels of investment activity

“As a result, average yields have sharpened significantly over the past 12 months,” Swan says.

“Buyers are clearly taking a long-term view on the Queensland economy, as reflected in the very high levels of investment activity.”

JLL is currently marketing the strongly performing neighbourhood shopping centre Pimpama Junction in the Brisbane-Gold Coast growth corridor, for sale on behalf of Sydney-based Tipalea Partners via a formal expressions of interest campaign that is due to close on March 17.

A retail centre in Mermaid Beach in Queensland will be sold at auction.

It is a brand new 5441sqm neighbourhood centre that is anchored by Woolworths and supported by 17 specialty retail tenants, four medical and health occupiers, three ATMs and one kiosk.

The centre occupies a high profile 2.1ha site, with 300 car parks provided at-grade. ​

“Pimpama Junction is an outstanding example of a prime neighbourhood centre with long income security to a dominant Woolworths Supermarket through a 20-year lease with three 10-year options,” Swan says.

Average yields have sharpened significantly over the past 12 months

Meanwhile, a prominently located retail investment opportunity at Mermaid Beach, on the Gold Coast, is being offered for sale via auction by Ray White Commercial Gold Coast.

Located at 2211 and 2215 Gold Coast Highway, Mermaid Beach, the property includes two buildings on a total land area of about 1555sqm, including 14 tenancies that generate a net rental income of about $447,000 per annum.

The tenancies include the Nobby Beach Post Office, a medical centre, pathologist and chemist, a hair salon, take away food outlets and Little Bean Coffee Shop.

The property is located between Lavarack Rd and Chairlift Ave on the Gold Coast Highway, and the two buildings offer a combined net lettable area of about 817sqm.

The property will be auctioned at the Gold Coast Turf Club, Racecourse Rd, Bundall, at 11am (AEST) on March 17.