Two retail investments sold for low yields this week.
In Altona North, a fast food restaurant held for 32 years has collected $6.2 million.
The Hungry Jack’s outlet at 155-159 Millers Road traded to a Sydneysider for at a 3.8 per cent yield, believed to be a record low for a Victorian property of this type.
Spreading 1780 square metres at the south east corner of Blackshaws Rd, the property was offered with a lease expiring in 2028.
With options, the tenant, controlled by Jack Cowin’s Competitive Foods, can stay 40 years after that.
Their deal comes 15 months since a KFC-backed property in Sydney’s Dulwich Hill traded for $4.26m – reflecting a 3.17pc return – believed to be the country’s lowest for an investment of this type.
Last December, another Sydney property, at Dee Why, with two fast food outlets, sold for $13.02m – or a 3.43pc yield (story continues below).
Caydon sells another Moonee Ponds shop
Meanwhile in Moonee Ponds, Caydon Property has offloaded another small retail investment on the ground floor of a new apartment building.
Shop 4, 40 Hall St, leased to tattoo eradicator Remover, sold to a local investor for $1.11m – a 4.57pc net yield.
It is the third shop Caydon has recently sold in the complex – coming two months since a 172 sqm space rented to café, Mr Majestic, traded for a 4.33pc return. Last June a 145 sqm tenancy occupied by Bottlemart exchanged for $1.025m.
“There is certainly greater scrutiny placed on retail investments in the post-COVID-19 market, however, there still remains a shortage of well-located properties on the market as investors’ hunt for yield continues,” Mr Hawthorne said.
Of the Altona North deal, Mr Heng added “to receive a total of eight offers…highlights the current depth in the market from this buyer profile at present”.