25/02/2014 - 09:58

Northam shops sell for $14m

25/02/2014 - 09:58

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Northam shops sell for $14m
The Northam Boulevard Shopping Centre.

Local investors are showing increased interest in Western Australian retail assets, with the off-market sale of Northam Boulevard Shopping Centre for $14.05 million highlighting the growing demand, according to Colliers International.

The commercial real estate agent's director of retail investment services, Mark Werrett, said there had been a series of high-profile retail property sales to overseas interests during the past 12 months, including the $76.5 million sale of the Phoenix Shopping Centre and the $28.5 million sale of a new neighbourhood shopping centre at Wellard, both to Singapore-based investment groups.

Other major transactions included the $6.8 million sale of the South Lake Shopping Centre to a Malaysian investor, and the $15 million sale of the Kelmscott Plaza Shopping Centre to a Singaporean buyer.

The 6,346 square metre Northam Shopping centre, which is anchor-tenanted by a Woolworths supermarket and includes 22 specialty stores, was bought by a private WA-based investor.

Mr Werrett said the interest from overseas parties in WA retail assets had driven local investors to enquire about prominent properties before they hit the market.

“Local investors have been increasingly finding themselves facing stiff competition for these sorts of assets from overseas buyers, who are willing to pay a premium for strongly-leased, well-located retail centres in growing catchment areas,” he said.

Mr Werrett said the Northam transaction was the first of several major deals he expected to settle in coming months, but warned opportunities would become thin on the ground after a strong year of sales in 2013.

“I’d anticipate that as a result of the reduced opportunities to purchase neighbourhood centres this year, we will see upward pressure on prices – and it’s likely that yields will tighten by 0.5 per cent to 1 per cent by the end of 2014,” he said.

“This is already being experienced on the east coast in early transactions as a result of the big institutional players such as Dexus, Federation and Charter Hall re-entering the market.”

 

 

 

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