Stonebridge Property Group has transacted the BP Westernport Service Centre in Cranbourne Victoria sold for $20.3 million on behalf of Fawkner Property, in one of the largest service center transaction in recent times. The deal was negotiated by Justin Dowers, Kevin Tong and Phillip Gartland Stonebridge Property Group. 

The deal was negotiated by Justin Dowers, Kevin Tong and Phillip Gartland which represented a strong yield of 5%, further demonstrating the surge in demand for convenience, fast food and essential service retail investments.

Deal at a glance:

• Asset: BP Westernport Service Centre 
• Address: 910 Thompsons Road, Cranbourne West
• Sold Price: $20,317,035
• Yield:5.00%
• WALE: 10.7 years 
• Tenants: BP, Carls Jr and Red Rooster
• Vendor: Fawkner Property 
• Purchaser: Private Victorian Investor
• Selling Agents: Justin Dowers, Kevin Tong and Phillip Gartland Stonebridge Property Group. 
• Source: Stonebridge Property Group 

Located on a large 1.98ha site at 910 Thompsons Road, Cranbourne West, the property comprises a fully leased 672sqm (GLA) center, returning an annual net income of $1,016,365 from three separate tenancies, BP, Carls Jr and Red Rooster.

“This is a very strong result for non-head company BP Lease – there is a huge weight of capital seeking long WALE convenience assets, which is putting pressure on pricing.” Commented Justin Dowers.

Mr Dowers added that “strong interest was received from mainly private investors, however certain syndicates and funds were interested given the deal size and fixed income growth”.

The Vendor was very pleased with the outcome noting that pricing had escalated substantially since they acquired the property in 2013, which was predominately due to the new leases in place, rising value of the 1.9ha underlying land parcel and development potential.

The service centre is in a major growth position in Melbourne’s south east, with a 275 metre frontage to Westernport Highway.

Along with current low cost of debt and lack of supply being some of the main drivers of the strong demand received, Mr Dowers insisted that investors gained confidence in the corner positioning which was supported by the amount of traffic passing the site daily, in addition to the 10.7 year WALE.

Mr Tong added that “Cranbourne has been experiencing significant growth and the positive future outlook for the suburb added to buyers sentiment.” The City of Casey was one of Australia’s fastest growing LGA’s for the 2018-19 period, growing by over 13,000 people, or 3.9%.