Woolworths Bulli has hit the market, giving buyers the opportunity to secure a premium supermarket anchored, trophy neighbourhood shopping centre located in one of Greater Sydney’s tightest geographical catchments, just 72km south of Sydney’s CBD and 12km north of the Wollongong CBD.
The rare offering is anchored by a brand new, long-term ten-year lease to a strongly performing Woolworths supermarket and supported four defensive non-discretionary based specialty tenants.
Developed by Woolworths and completed in 2015, the centre is positioned on a unique 14,570m2 freehold site. The centre is designed over a single level and provides convenient at grade car parks for 212 vehicles, with the majority benefitting from shade sail protection.
Woolworths Bulli will be offered for sale via an expressions of interest campaign closing 29th April 2021. JLL’s Retail Investments team, Sam Hatcher and Nick Willis have been appointed to sell the Woolworths-anchored centre.
While the centre has a brand new ten-year lease to Woolworths, Hatcher said, “the favourable mixed-use zoning has potential for over 250 residential units (subject to council approval), allowing for long-term redevelopment, which underpins the investment case.
“The existing provision of supermarkets within the northern Illawarra catchment and the shortage of development sites suitable to accommodate full line supermarkets underpins the defensive nature of this strongly performing Woolworths supermarket.
“Core capital is becoming increasingly sector agnostic and asset specific – the resilient and defensive underlying income stream generated from this offering will attract core capital,” said Hatcher.
“Woolworths Bulli encapsulates three key investment fundamentals including high barriers to entry ensuring security of trade, growth of income and strong underlying land value,” said Willis.
“Growth in food spending (grocery and liquor) has remained above average since the peak in March 2020, recording growth of 12.3% year-on-year to January 2021. Food spending has grown consistently over the past two decades and achieved the fastest rate of growth among the major spending categories throughout that time period (5.5% CAGR). Woolworths Group has been a key beneficiary of this trend, recording H1 FY21 sales growth of 10.6% in its Australian Food segment.”
Bulli’s median house price has risen from $631,500 (December 2014) to $1,222,500 (March 2021), reflecting a substantial annual growth rate of 15% per annum, according to data from realestate.com.au. An increase in house prices has continued to create a wealth effect for the existing population, which JLL forecasts will be compounded by the combination of Sydney residents relocating to the catchment to increase affluence, which is expected to drive Woolworths’ MAT growth into the future.