Pubs, burgers, a TAB and hardware on the menu in $135m auction
Pubs, hardware stores, a burger restaurant and a TAB are expected to be hotly contested by hungry investors chasing essential services assets in a $135 million portfolio auction.
Pharmacies, a bank building, a cafe/coffee roastery, op shops and childcare centres are also among the 39 properties going under the hammer over two days next week in Burgess Rawson’s latest portfolio auction.
The agency said the in-demand assets have attracted strong interest from local and international investors, including some who missed out in the February portfolio auctions.
“With such a large number of properties, the price expectations will have wide appeal, ranging from entry-level prices to in excess of $11.5 million,” Burgess Rawson director Raoul Holderhead said.
The agency will auction 27 properties worth $100 million in Melbourne on Wednesday 31 March, a day after its Sydney auction of 12 properties worth $35 million.
High-net-worth private investors are among those buyers chasing four trophy pubs that Australia’s largest pub landlord, ALE Property Group, has put on the market.
The properties – the Pelican Waters Tavern on the Sunshine Coast, Kedron Park Hotel and Edinburgh Castle Hotel in Brisbane’s north, and the Morwell Hotel in Victoria’s Latrobe Valley – all have 25-year triple net leases to Australia’s largest pub operator ALH, whose parent company Endeavour Group is 85.5% owned by Woolworths.
The prices for the pubs are expected to range from $2.7 million to $7.6 million.
A property in Sydney’s Neutral Bay leased by Tabcorp as a TAB betting outlet is also attracting attention and is expected to sell for more than $3 million.
“This rare opportunity to purchase a first-class, ASX-listed, tenanted investment in such a strong metro location has, as expected, seen high levels of interest from local and international buyers,” Burgess Rawson associate director Kieran Bourke said.
Mr Holderhead said a Carl’s Jr in Thomastown will be the first Victorian restaurant in the global burger chain’s network to be brought to auction, with price expectations of about $5.5 million.
For coffee lovers, there is a converted warehouse in Brisbane’s Newstead that is leased to coffee brand Industry Beans. It features a large cafe, coffee bar, function spaces and a coffee roastery.
Three properties leased to Tasmanian hardware brand Nubco, part of the ASX-listed Coventry Group, will be auctioned: in Kingston, Mornington and Wivenhoe.
Burgess Rawson agent Beau Coulter said hardware had earned a reputation as “pandemic proof” throughout 2020. He said the three sites benefit from their proximity to Bunnings outlets, which compete for a different section of the hardware market.
Childcare assets have also been strong performers during the pandemic, with Burgess Rawson childcare specialist Adam Thomas expecting the several childcare investments – tipped to sell from $2 million to more than $7 million – will be hotly contested.
“The appeal of childcare investment continues to prevail,” Mr Thomas said. “We are consistently breaking yield records and investors are certainly prepared to spend the money to secure a prime property with a long-term lease and quality tenant.”
A Chemist Warehouse in Nowra on the NSW South Coast and Star Discount Chemist in the NSW town of Cardiff are also attracting investor interest.
“We have seen a doubling in demand for medical investments from buyers looking for the security and comfort afforded by these types of commercial uses,” Burgess Rawson director Dean Venturato said.
Other properties up for auction include a site leased to the Commonwealth Bank and St Vincent de Paul in the NSW town of Richmond, a Salvos store in NSW’s Maitland and a car wash in Townsville.
SOURCE: Megan Neil, Real Commercial