The Modbury Heights Shopping Centre in Adelaide’s north has sold in an off-market deal for $10.5 million.
The convenience-based neighbourhood shopping centre at 172 Ladywood Road in Modbury Heights, around 16 kilometres north of the Adelaide CBD, has 3,995sq m of GLA on a 13,800sq m site.
Originally built in the 1980s, the centre is anchored by a 3,095sq m Woolworths supermarket and includes 10 specialty tenancies, an ATM and around 226 car parks.
It was purchased by a local private in an off-market deal negotiated by Knight Frank agents Ryan Mills and Max Frohlich on behalf of a local private vendor.
The sale reflected an initial yield of 5.05% and a market yield of approximately 5.50%.
The centre, which is the only shopping centre within the suburb of Modbury Heights, is on a well-exposed site with three street frontages and positioned directly opposite the Modbury Heights School, a combined primary and secondary school with around 1,800 enrolled students.
Mr Mills said the retail property appealed to a range of investors during the off-market campaign, with one of the biggest drawcards being its stable income from high-quality tenants.
“Nearly 90% of the gross passing income is accounted for by blue-chip ASX tenants — namely Woolworths and Liquorland,” he said.
Mr Frohlich said: “Woolworths recently extended their tenure on a five-year term with options, securing the income for several years to come.
“The asset was heavily underpinned by land value and was sold well below replacement value. Opportunities to buy a Woolworths or Coles-backed neighbourhood shopping centre for circa $10 million are extremely rare nationally.”
Knight Frank’s recently-released Australian Retail Review found the outlook for the retail sector was increasingly positive following a challenging period, with conditions in place for growth from 2025.
It found positive signs for the sector included improving retail sales and the return in asset value growth.
The Knight Frank report found improving investor sentiment had led to increased investment in retail property.
Total investment volumes in the retail sector rebounded strongly in 2024 with $9.9 billion traded, up 39% from 2023. South Australia’s retail investment volumes reached a 20-year high in 2024 at $0.9 billion, according to Knight Frank research.
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