Aldi Supermarket Investments Rare as Hens Teeth

19 July 2022

The first national campaign for an Aldi supermarket this year is hitting the market with the sale of Aldi West Melbourne, a brand new trophy metropolitan Melbourne supermarket.

Colliers’ Tim McIntosh, Mike Crittenden, Oliver Hay and Daniel Wolman in conjunction with JLL’s Tom Noonan, Stuart Taylor and MingXuan Li have been exclusively appointed to sell the brand new Aldi supermarket on Spencer Street, West Melbourne. The trophy supermarket located 800 metres from the Melbourne CBD is being offered for sale via an Expressions of Interest campaign closing Thursday 11th August 2022.

Aldi is the third largest supermarket operator in Australia with over 570 stores nationally and an 11 percent market share, behind Coles at 28% and Woolworths at 37%. Aldi does however take the mantle of Australia’s largest supermarket owner, with a significant majority of their freestanding supermarkets owned by the head company.

Tim McIntosh, Director of Retail Middle Markets at Colliers said “Supermarket investments are highly sought after by investors attracted to their ultra-defensive and recession proof characteristics coupled with above-trend income growth.”

“The opportunity to acquire a trophy Melbourne supermarket secured by Aldi Australia is exceptionally rare, particularly in a prime CBD-fringe location with attractive depreciation benefits. Accordingly, we expect significant interest from a range of local and offshore investors” said Tom Noonan, Director of JLL Retail Investments.

Aldi West Melbourne is a brand new supermarket boasting a brand-new 14-year lease with annual CPI increases, located within the luxury mixed-use development by Lechte Corporation, CDL Australia and Crema Group – The Marker, 512 Spencer Street, West Melbourne.

“In the current environment, the highly attractive CPI annual increases capped at 8.0% provide investors with significant income growth and represents an inflationary-hedged investment opportunity with long-term security to a AAA covenant.” Stuart Taylor Senior Director of JLL Retail Investments said.

Mr Hay said “Aldi West Melbourne sits within the most rapidly growing CBD-fringe precinct, with significant residential and commercial population growth driven by the City of Melbourne’s West Melbourne Structure Plan. There are over 1,000 apartments being developed between 2021-2023.”

Recent Metropolitan Melbourne Supermarket Transactions:

Centre NameSuburbStateSale Date Sale PriceInitial Yield
Coles LalorLalorVICMar-22$13,768,8882.98%
Woolworths ElthamElthamVICApr-22$35,000,0003.33%
Woolworths BalwynBalwynVICNov-21$45,700,0002.98%
Coles Local Glenferrie RdHawthornVICNov-21$24,500,0001.90%
Woolworths Blackburn SouthBlackburn SouthVICOct-21$29,300,0002.46%