Kinglake flips Capalaba asset for a premium
Kinglake Group has turned an impressive capital gain selling a large format retail investment after 16 months.
The Melbourne based asset manager is reaping $13.5 million – a 5.34 per cent net passing yield – for 72-74 Redland Bay Road, Capalaba, about 25 kilometres east of Brisbane.
Occupier, Repco, an arm of GPC Asia Pacific, just moved in, committing to the 1924 sqm improvement for an initial 10 years, for a new generation format MAX store.
The lease agreement includes fixed annual rent rises of 3.25pc.
The business picks up all outgoings too, including land tax.
The 4865 sqm block also contains 52 car parks.
Kinglake turns profit
Kinglake paid $9m – a 5.93pc return – for 72-74 Redland Bay Rd but the tenant, Fantastic Furniture, was on a lease about to expire.
A major fit-out was carried out early this year.
The onsale was brokered by Stonebridge Property Group’s Rorey James, Kevin Tong and Tom Moreland with Colliers’ Harry Dever and Tim McIntosh.
The result prices the lettable area at $7017 per sqm, said to be a local record.
“It was a good result given the time, effort and capital invested in upgrading the building to suit Repco’s needs,” Kinglake co-founder and director, Jamie Allen, said.
“The outcome validates our strategy of targeting value-add retail assets in tightly held corridors,” he added.
The deal comes 11 months since we reported Kinglake sold a Fawkner, Melbourne, showroom leased to Supercheap Auto for $5.45m – a 5.3pc net passing yield.
Meanwhile, early this year, it bought a large format retail investment, again in Melbourne, at north west Sunbury, for $19.5 – a six per cent return.
Coincidentally, Repco is a tenant client at that property.
Kinglake was formed not long earlier, also with Harry Nettlefold and Hamish Baillieu.
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