Weekly Transaction Update - 2nd June
A very busy week this week with another $1.0B of assets changing hands.
The most notable deal was the sale by LaSalle Investment Management of the Castle HIll and Marsden Park Homemaker Hub Centres for $436M to Aventus Retail Group. Trading on a yield of 5.6%, the purchase compares to yields for traditional retail centres yet is likely to carry additional risk due to the discretionary nature of the tenant mix and the impacts from newcomers like Amazon. The Centres' are however well located, target a broad demographic catchment and offer long term expansion potential which Aventus will hope to capture. LaSalle acquired the two assets in 2012 and 2015 for $244M, making a capital gain of circa $190M and an IRR in excess of 30%.
In another record breaking deal, Charter Hall announced the purchase of the Salamanda Bay Shopping Centre in NSW from CPBIB and Future Fund. The property is anchored by Coles, Woolworths, Kmart, Aldi, and Target Country and has approx 55 specialty and was transacted on a yield of 6%. This represents the largest price and the highest rate per square metre for a retail asset in regional NSW over the last 2 years if not longer.
Tightly kept secrets don't last long in property as was evidenced this week with the sale of the Sydney GPO to the Far East Group for $150M. Far East own the adjoining Hotel and will now be able to take full advantage of the retail potential that the Martin Place address will offer.
Down on the smaller end of the list is a Fitness First Gym in Cheltenham Victoria. CMA actually participated in the early stages of this sale process in submitting an on behalf of a private client. The property comprised a single tenanted building of 5,335sqm across a 9,056sqm site. The tenant held a 8 year lease and a substantial fitout (including a pool) which they would struggle to replicate in alternative premises upon lease expiry. We priced the asset at $17.3M and note that it ultimately sold at $17.55M. At CMA's price, the property would have provided an initial yield of 6.9% and a 10 yr IRR or 7.2%.
There were a number of other significant deals this week including IProsperity's purchaser of an adjoining property in Glen Waverley ; Deutsch's purchase of a cold storage facility from Corval in Truganina and John Holland's purchase of a development site in Macquarie Park from the NSW Government.
Scroll through the list below or head to Propel for further details.