Diversified property investment manager PE Capital has sold the third and final piece of a convenience retail complex it has just developed adjoining a new housing estate.
The asset at 1016 Cranbourne-Frankston Road is trading to a local family for $8.25 million, a deal which reflects a 5.47 per cent passing yield.
It includes a service station leased to 7-Eleven for 15 years, an Oporto restaurant with a rent agreement in place for 10 years, and a smaller specialty store occupied by Smokin Joe’s Pizza, also until 2029.
PE Capital sold another part of the Cranbourne-Frankston Road complex to global fast food giant McDonalds for $2.9 million last year.
KFC bought next door to McDonalds for $1.9 million.
The convenience complex adjoins a housing estate former Carlton footballer Fraser Brown is building on the 40-hectare former Amstel Golf Course.
The golf club, which relocated to the neighbouring Ranfurlie course, which it also owned, sold Amstel to Mr Brown in 2015.
“A variety of listed funds and syndicators were attracted to the investment’s long-term leases to national operators 7-Eleven and Oporto, but they were priced out by the private investor market,” Mr Du Rieu said.
“Given the tenancy profile and price point, we consider this sale to be an excellent result for our client…particularly in the face of broader economic challenges in the first half of the calendar year”.
Last month developers Dug Pomeroy and Nigel Hunt sold a new service station leased to United Petroleum at 1050 Thompsons Road, Cranbourne West, for $4.9 million.
Across town, in the outer northern suburb of Mickleham, local developer Peter Spargo last week banked $7.1 million from the sale of a new service station with a 15-year lease to BP.