Coles Group has sold a recently completed shopping centre in Melbourne’s north for a price understood to be more than $44 million.
Aurora Village in Epping is trading to a China based investor on a passing yield of less than 5.8 per cent net.
About 20 kilometres from the CBD, Epping is one of Australia’s fastest growing municipalities and this complex, 315A Harvest Home Road, occupies a 2.3 hectare block zoned Town Centre.
Coles, and another supermarket, Aldi, occupy 76 per cent of the centre’s 9677 square metres of lettable area. The balance is tenanted to 16 specialty stores including Anytime Fitness, Degani café and a Coles Express service station.
Also with 305 at-grade car parks, the asset returns net annual rent of $2,567,000.
“The high percentage of income from the double supermarket anchor tenants creates a highly secure investment, however, it is the income growth potential that sets this centre apart,” CBRE agent Justin Dowers said upon listing the asset in October.
“Coles Aurora Village has a number of elements that will promote income growth. The net lease structure to Coles and attainable percentage rent threshold will promote rental growth in the near future, while the Aldi lease provides annual rent increases and the conservative specialty tenant rental levels will maintain health growth rate as the centre continues to attract a disproportionate share of customers within the rapidly growing catchment area”.
Mr Dowers marketed Aurora Village for Coles Group with colleague Mark Wizel.
Two years ago, Coles sold a near-new supermarket-anchored neighbourhood shopping centre in Coburg North, about 11 kilometres north of the CBD. This $38 million deal reflected a 4.9 per cent yield.
Last month, we reported that Woolworths sold two supermarkets in regional New South Wales for a total of $45.7 million. In August, it sold another investment in Perth for $27 million.
In August we reported that German retail brand Kaufland spent $19.7 million on a former Bunnings warehouse, on the Gold Coast, which it is reported it plans to occupy after a refurbishment.