Mordialloc Plaza sold for $41m

mordialloc_plaza_994 (1)The neighbourhood shopping centre Mordialloc Plaza has been sold for $41 million to a high profile industry player on a 4.39 per cent yield.

The centre, owned by a Singaporean-based family for 30 years, is situated on a 6600sqm site at 600 Main Street. The 4532sqm (GLA) centre is anchored by a full line Woolworths Supermarket with 11 specialty shops and access to more than 120 car spaces.

The property offers and annual income of around $1.8 million, with the Woolworths lease expiring in 2025 including three, seven year options.   

The property is fully leased with shops including Bakers Delight, Domino’s Pizza and Flight Centre.

The deal was brokered by CBRE‘s Retail Investments team of Mark Wizel, Justin Dowers, Lewis Tong, and Kevin Tong in conjunction with Ken Smirk from Knight Frank.

Wizel said the latest sale represented the strongest start for CBRE Victorian Retail Investments since 2009, with seven sales from seven campaigns transacted representing a 100 per cent clearance rate.

“Across the seven assets a total of 56 offers have been received totaling a massive $1.792 billion of investor capital chasing retail investment assets,” Wizel said. “That reflects the fact that retail assets with a focus towards convenience and non-discretionary tenants remain highly sought after given their track record of weathering fluctuations in economic trends.”

Dowers said pre-Easter Amazon hype had done very little to dampen the enthusiasm of investors trying to secure retail investment assets while investors had accepted the inevitability of sub 5 per cent yields.

“Having sold seven retail assets with the CBRE Retail Investments team at a 4.76 per cent average yield this year there is no doubt that investors are now comfortable with sub 5 per cent as the new norm,” he said. A key part of this has been the recognition that most of these assets offer exceptional underlying land value and long term potential around  further development of sites which are almost invariably in the heart of town.”

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