A private investor has purchased Ormeau Marketplace in South East Queensland from regional fund manager Clarence Property for $34 million.
The deal was brokered by CBRE’s Joe Tynan and Michael Hedger jointly with JLL’s Sebastian Fahey and Nick Willis, achieving a strong yield of 5.24%. Ormeau Marketplace represents one of the first single (non-portfolio) neighbourhood shopping centre transactions in Australia since the RBA began raising the cash rate in May, by 225-bps as of September.
“The quality of this asset attracted both onshore and offshore investor interest during the competitive off-market process, with the successful purchaser having a portfolio of similar assets across Australia,” Tynan said.
“The sale of Ormeau Marketplace demonstrates the continued focus from groups seeking to invest in this asset class as a hedge against inflation. These neighbourhood centres, where the income is derived from non-discretionary retailers, can benefit from income growth via higher productivity and sales growth in an inflationary environment.”
The 4,718m2 neighbourhood shopping centre is anchored by a 4,100m2 full-line Woolworths supermarket alongside a mix of six non-discretionary based retailers, with a strong representation of allied health and medical tenants.
Located 35km north of the Gold Coast CBD and 45km south of Brisbane, Ormeau Marketplace offers a secure income profile, with a 11.5-year WALE and 87% of the income underpinned by Woolworths on a long-term 20-year lease, expiring 2035.
JLL’s Sebastian Fahey said: “The asset represents a very defensive income profile due to the limited specialty risk and the long-term leases, and is strategically positioned to capture the growing population within the northern Gold Coast corridor with the Main Trade Area to grow 21% by 2026.”
“While the increasing cost of debt has caused some uncertainty with investors, we are still experiencing strong demand for quality prime convenience-based assets in tightly held locations.”
Clarence Property has recently changed the name of its $720 million flagship fund to Clarence Property Diversified Fund (CPDF) – formerly known as the Westlawn Property Trust (WPT).
CPDF has grown its total portfolio to 48 assets with recent acquisitions including the additional 50% of The Rocket in Robina, an Australian Government asset in Port Macquarie, a Robina development site earmarked for a 5,000m2 office building and four long leased childcare centres.
