A consortium of private investors has offloaded a neighbourhood shopping centre in a semi-rural coastal town slowly being encroached upon by housing estates.
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The Pearcedale Village Shopping Centre, at 75-99 Baxter-Tooradin Road, exchanged hands for $6.8 million, reflecting a yield of 6.5 per cent based on the asset's annual rental return of $442,000.
The yield is considered low given the centre doesn't have an anchor tenant. Instead, the 2064-square-metre block includes 14 specialty retail shops around an 85-plus bay car park.
BP, Bendigo Bank and an IGA Supermarket are high profile tenants.
The complex abuts a vacant block of land zoned general residential, which allows for medium-ensity development. The local primary school is less than 100 metres away.
Pearcedale is about 50 kilometres south-east of Melbourne, immediately south of Cranbourne South and near Langwarrin – both suburbs which have seen increased new home development over recent years.
CBRE agents who negotiated the deal said the new owner, a private investor, could easily build three more tenancies within the complex.
"The property's future growth prospects, sub $10-million price point and the lack of Victorian retail assets for sale were key selling drawcards," CBRE associate director Justin Dowers said.
Mr Dowers marketed the centre with Mark Wizel and Rorey James.
The sale follows QIC paying $26 million for the Coburns Central Shopping Centre in Melton, about 35 kilometres west of Melbourne (and abutting QIC's Woodgrove retail asset which it just extended). The Coburns Central deal was struck on a yield of 5.8 per cent.
Also in the west this month, a Masters Home Improvement leased store at Williams Landing sold to listed developer Cedar Woods for $36 million on a yield of 6 per cent.
Last month, the Maroondah Village Shopping Centre sold for $13.3 million, reflecting a yield of 5.4 per cent. This Croydon complex failed to sell when it was listed in 2012.