HomeCo have sold their Knoxfield large format retail centre in Victoria for $45m continuing the strong demand for real estate assets.
The 13,603sqm centre was acquired by the Troon Group on a 5.00% fully leased yield.
Stonebridge Property Group agents Justin Dowers and Kevin Tong acted as agent on behalf of HomeCo.
The sale highlights the strong fundamentals and performance of the large format sector, which has seen a resurgence as a result of the pandemic.
Stonebridge’s Justin Dowers said, “large format retail assets have witnessed a resurgence in the past 18 months, both from a retailer performance and investment demand perspective. LFR assets benefitted from a series of compounding positive attributes including their high degree of convenience/parking and limited enclosed spaces and recent zoning changes (particularly in Victoria), allowing a diverse range of additional convenience “Daily Needs” And Essential Services uses for customers”
“The global pandemic has accentuated the re-positioning of the “sectorial hierarchy” within the Australian commercial real estate landscape. whilst industrial investment has usurped almost all other commercial sectors, the attributes of LFR sector, being the closest in configuration and simplicity to industrial, has not gone unnoticed. With prime industrial yields now well below 4%, the attractiveness of the typical LFR asset, given its intrinsic land, lower site intensification, building attributes and yield arbitrage have all put the savvy industrial investor on high alert.”
Kevin Tong said “there has been a strong uplift in sales performance in key LFR categories. The inability to travel overseas has seen people put that money into their homes which is why a number of LFR categories are outperforming at the moment.”
“The underlying 4.3 hectares of industrial zoned land has increased in value significantly over the last few years, which no doubt made this investment a lot more attractive”
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