Victorian public servants in the black following Bunnings disposal
A fund backed by VFMC – which manages annuity on behalf of 32 Victorian public authorities and related organisations – and Telstra Super, has shed a regional large format retail asset after seven years.
Bunnings Shellharbour at Albion Park Rail, about 110 kilometres south of Sydney, is trading to an Asia-based private investor for $40.6 million – a 4.89 per cent net passing yield.
The Long WALE Hardware Partnership, or LWHP, managed by Charter Hall, outlaid $26.8m for the then-new complex.
CBRE’s James Douglas brokered the off-market deal.
Costi Cohen’s Tas Costi and Jacky He were the buyer’s agents and transaction advisors.
It is the second property Charter Hall has divested this month for a sub-5pc return; the other, a childcare centre in Melbourne, collected $16.5m.
Bunnings Shellharbour
Bunnings Shellharbour, also known as Bunnings Albion Park, at 15 Shandan Circuit, facing the Princes Highway too, near New Lake Entrance Road, contains 13,120 sqm, on 3.23 hectares with 344 car parks (story continues below).
The weighted average lease expiry is 10.9 years.
“The transaction…represents the largest Bunnings warehouse sale in New South Wales in over three years and the largest nationally since early 2023,” Mr Douglas said.
“Despite the lack of recent transactions, Bunnings sores remain highly sought-after by a broad range of investors due to the typically long-term nature of the leases and inbuilt fixed annual rental growth,” he added.
“It is an interesting period in the market for highly secure, single tenant ‘bond style assets’ with some investors targeting [properties] with predictable returns higher than where they believe the cash rate is forecast to settle over time” according to the executive.
The disposal comes four years since the LWHP outlaid $353m for six metropolitan Bunnings stores, in Sydney, Melbourne, Brisbane and Adelaide.
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