The convenience-based shopping centre at 297 Peachey Road, Munno Para, in Adelaide’s north, sold to a local private investor following a hotly contested expressions-of-interest campaign.
Savills Australia’s Rino Carpinelli and Steven Lerche brokered the deal on a yield of 7.3 percent, saying they had anticipated strong interest from investors after limited neighbourhood retail opportunities came to market last year.
“Occupying 2.032 hectares and generating about $1,613,400 per annum, the successful buyer recognised the ongoing value of this asset,” Mr Carpinelli said.
“The centre offers significant depreciation benefits backed by a secure income stream and long weighted average lease expiry of 9.12 years by area.”
The centre presents a gross lettable area of 6,390sqm comprising the full-line Woolworths supermarket and associated BWS liquor store, which are operating under a new 12-year lease. There is also a mix of 17 speciality tenants, including a Smokemart, newsagency, café, medical centre and Terry White Pharmacy.
Mr Carpinelli said the purchaser “pounced on” the opportunity to get a foothold in Adelaide’s Playford Alive precinct.
“There is no doubt there is repressed demand from investors wanting to enter growth areas such as Playford,” he said.
“Buyers are looking to capitalise on Adelaide’s northern growth corridor and the large number of dwellings to be constructed within the city’s fastest-growing precinct.”
Mr Carpinelli went on to say that the shopping centre’s location within a new and highly regarded retail precinct had been a key drawcard throughout the campaign.
“The centre is strategically positioned to benefit from uplift in local retail spend in the coming years, with the main trade area population estimated to increase from 35,340 people as at June 2018, to 47,890 people by 2031,” he said.
“Similarly, the current retail trade area expenditure of $397million is forecast to significantly grow to $720 million by 2031.”
Mr Lerche said shopping centres like Woolworths Playford were rarely traded in South Australia.
“This centre serves the everyday needs of the local community and is classed as a defensive asset, driven largely by non-discretional shopping,” he said.
Woolworths Playford is part of the $1billion urban development project, Playford Alive, which is being jointly managed by the City of Playford council and state government. The precinct comprises popular suburban-lifestyle facilities, such as healthcare, education, recreation and a new $250 million town centre.
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