Sydney investor buys regional retail hub
Blackfox Property, for a trust now seeking investors, has bought the prominent Shepparton Retail Hub – where 95 per cent of the area is leased to ASX-listed businesses.
The Sydney fund manager is paying $11.61 million – a 7.25 per cent acquisition yield – for the 1.02 hectare Activity Centre zoned asset at 278 High Street (or the Midland Highway), on the south east corner of St Georges Road – passed by some 22,000 vehicles a day.
With 3820 square metres, it contains the only Officeworks within 105 kilometres; the stationery giant is on a 13 year lease for its 2177 sqm tenancy.
Bottle O’Warehouse (a Metcash brand), Club Lime Gym and Red Rooster – the latter on a 35 year rental agreement for its pod site – are other occupiers.
The weighted average lease expiry was 6.2 years when the property was listed late last year.
Also fronting Rowe St, diagonally adjacent to the town’s train station, the asset contains 114 car parks too – giving it potential development upside.
Blackfox, directed by Marc Schwartz and Greg Bachmayer, can also claim the state government’s 50pc stamp duty concession.
Describing the investment as “substantially under-rented” the group is forecasting the closed and unlisted trust it is earmarked for, the Blackfox Shepparton Retail Fund, will deliver an eight percent average distribution to be paid monthly.
Over a four to six year term, it is modelling a 12-13pc internal rate of return post fees pre-tax and to spend very little on maintenance (story continues below).
Stonebridge’s Justin Dowers and Rorey James were the agents.
Another regional retail deal
Shepparton is Victoria’s fifth biggest regional city with a population of c70,000.
The 278 High St deal comes two months since Geelong’s Pakington Strand sold for $31.8m – a 5.75pc market yield.
Mr Dowers with colleague Kevin Tong brokered that deal which saw a dozen offers come in.
Three years ago meanwhile Sydney’s Revelop acquired the West Place shopping centre, at Churchill.
Also today we are reporting an offshore investor paid $7m for a Shepparton processing plant leased to Cleanaway.
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