Tranche of 18 service stations net 7-Eleven owners $78.2 million

A portfolio of 18 7-Eleven outlets offered as sale and leaseback investments traded for $78.2 million to separate buyers at an auction event on Tuesday.

The deal comes two months after the vendor – controlled by 7-Eleven’s Australian franchise owners, the Withers and Barlow families – banked $77.9 million selling 15 petrol stations, also with leasebacks.

At this week’s sell-down:

  • The blended yield was 4.83 per cent;
  • Eight of the investments exchanged on returns of about 4 per cent;
  • The overall value came it at nearly $8 million more than was expected.

The offerings were located in the Australian Capital Territory, New South Wales, Queensland and Victoria.

An investment in Sydney’s ritzy Wahroonga achieved the lowest yield – 2.5 per cent – when it sold for $4.67 million.

A 7-Eleven outlet with surplus development land, in Melbourne’s eastern Wantirna, exchanged for the highest price – $7.13 million.

All 33 stores were offered with 12 year leasebacks.

Burgess Rawson directors Billy Holderhead and Jamie Perlinger, with Charter Keck Cramer’s Andrew Grant, Jessica Crossland and Tom Brynes as transaction advisors, represented the vendor.

7-Eleven general manager of Retail Operations, Braeden Lord, said “the proceeds from the portfolio sales will be critical for our targeted rollout of more than 30 stores per year and over 200 planned store upgrades across the existing network this financial year”.

The company recently sold its long-time Mount Waverley headquarters at 357 Ferntree Gully Road to rent in Cremorne, in Melbourne’s inner east.

In 2014, the Withers and Barlow families sold another 15 7-Eleven freeholds, with leasebacks, reaping $71.1 million.

Busy period for service station news

Last December, Charter Hall paid BP $840 million for a 49 per cent stake in 225 service stations – the majority of the occupier’s national store network.

Earlier this month it was reported Charter Hall was seeking to raise another $90 million, to increase its exposure in that BP portfolio by about 17.5 per cent.

Ampol also listed a national portfolio of 25 service stations late last year. Marketed as development sites the vendor banked 136 million, or $92 million after remediation costs, finding favour with a mix of investors and builders.

Until two months ago, these Ampol outlets were trading as Caltex stores.

However late last year, Chevron announced its intention to return to the local petrol sector, paying $288 million for Puma Energy, which owns 270 service stations, 20 depots and three seaboard terminals in Australia.

Chevron also took back control of the Caltex brand Puma had been renting to Ampol.

Corio’s 7-Eleven sold for $3.44 million, reflecting a 4.64 per cent passing yield.

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Marc Pallisco

A former property analyst and journalist, Marc is the publisher of realestatesource.com.au.

Marc Pallisco