Industry News

Trophy Coles supermarket hits the market

A full-line Coles Supermarket featuring a rare 20-year lease (expiring June 2036) in Five Dock is set to be the first publicly marketed Sydney metropolitan Coles Supermarket since 2019.

The property is likely to be hotly contested, given the pent-up demand for pandemic proof assets and the centre’s $25 million price expectations.

James Wilson and Alex James-Elliott of Colliers are handling the sale, with the campaign launching in June 2021.

Coles Five Dock is located in the prized inner west of metropolitan Sydney, only 9kms from the CBD. It is positioned along the high-profile retail strip of Great North Road, and is forecast to benefit from the proposed Sydney West Metro Five Dock Station opening in 2030.

“Supermarket investment demand, specifically from the private investor market, coupled with the record low cost of debt is anticipated to drive purchaser engagement for this campaign, said James Wilson, National Director of Retail Investment Services at Colliers.

“Investors will be attracted to the increased security afforded by the supermarkets 20 year lease, given the most recent ‘sale and lease back’ campaigns divested from Coles and Woolworths feature 10 year leases.”

“The Coles supermarket dominates its catchment, being the only full-line supermarket offering and is trading 29.2% above Urbis benchmarks resulting in percentage rent. Strong MAT forecasts may result in income growth, particularly given an upcoming Base Rent Review in June 2022 and an MTA reflective of affluent family demographics with per capita incomes 32.0% above Sydney averages.”

Alex James-Elliott, Associate Director, Retail Investment Services at Colliers said, “There were only two publicly marketed supermarket opportunities in 2020, a year in which supermarkets highlighted their investment fundamentals.”

“The last Sydney metropolitan supermarket brought to market was back in 2019. This lack of stock and current investor demand for strong performing supermarkets investments, means that investors demand has not yet been satisfied.”

“We expect further opportunities for investors to secure metropolitan supermarkets in Sydney for 2021 to be limited.”

About the author

Shopping Centre News

Shopping Centre News (SCN) is in the ‘information business’, and is perceived as such by its readers. Daily industry news makes a must-visit as part of the morning routine for those who want to keep right across the latest retail developments and events, while SCN's premium magazine is the leading publication for the shopping centre industry in Australia and New Zealand.

Known as the ‘industry bible’ SCN is printed five times a year with fascinating, in-depth features and important critical analysis written by known industry insiders as well as the popular ‘Guns’ reports, which ranks Australian shopping centre performances. Shopping Centre News is the only publication in the world that features centre statistics on Turnover, Turnover per square metre and Specialty Shop turnover per square metre for every major centre in Australia.

Add Comment

Click here to post a comment