Bunnings Warehouse
Six of the long WALE assets are leased to retailer Bunnings (picture is located at Warwick in southeast Queensland). Source: Image supplied.
  • Private investors has listed a $450 million portfolio
  • The portfolio consists largely of long WALE, single tenant assets
  • CBRE's Simon Rooney has been appointed in charge of the portfolio sale

A private syndicate of Australian-based investors has listed a high-quality portfolio of 14 core retail assets for sale, with pricing expectations up to $450 million.

Simon Rooney, CBRE’s Pacific Head of Retail Capital Markets has been appointed to steer the portfolio sale.

The portfolio is comprised of predominantly long WALE, single tenant assets (six of which are leased to leading home improvement and outdoor products retailer Bunnings).

The sale process follows the recent acquisition by Charter Hall‘s Long WALE Hardware Partnership of six Bunnings stores across Australia for $353.2 million.

“Having been actively pursued by numerous parties over recent years, the syndicate has decided to formally consider market approaches from a select group of investors via an off-market Expressions of Interest campaign closing in mid-March,” Mr Rooney said.

The blue-chip portfolio includes assets across five states: New South Wales, Victoria, Queensland, Tasmania, and South Australia.

The assets are primarily single-tenanted, and offer long-term lease covenants to Wesfarmers, Woolworths, and Coles. There are attractive rental growth provisions, with minimal capital expenditure required in the short to medium term.

Mr Rooney said the portfolio presents an immediate opportunity for major investors to acquire and grow a high-quality, long WALE or convenience/hybrid style retail portfolio.

“Most activity and demand for retail assets in 2021 is expected to centre around long WALE, primarily single tenanted, low volatility assets which offer transparent in-built returns, underpinned by strong covenants.

“This is expected to underpin ongoing interest in strong performing and highly resilient, food, service and grocery anchored assets which have a non-discretionary retail focus.”

Although many investors are cautious, Rooney said they remain opportunity-led, with a clear flight to quality focus and a realistic expectation that deal flow will continue to increase as border restrictions ease.

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