Noosa Outlook Shopping Centre, located 8km from Noosa has sold for $10.95 million, achieving a record yield of 4.99% for an IGA anchored neighbourhood shopping centre. Colliers’ Nick Dowling and Chris Maher alongside Your Commercial, negotiated the sale via an on-market EOI process during Covid-19 conditions.

“Noosa Outlook is one of the very few recent QLD retail investments offered to the market in the $10 million price range. The significant pent-up investor demand resulted in strong purchaser engagement with over 170 enquires, with buyer enquiry coming from all over Australia, Asia and South Africa. Ultimately 12 offers were received with four parties coming in with a sub 5% yield. Of these four, the purchaser not only had the lowest price but was also willing to commit on an unconditional basis which gave our client complete comfort. The result highlights the weight of capital targeting these tightly held shopping centres”, said Nick Dowling, Managing Director (Sunshine Coast, QLD) at Colliers.

Non-discretionary retail assets, particularly those with strong ‘essential service’ supermarket covenants, are in strong demand due to their resilient, ‘pandemic-proof’ income stream. The highest level of investment activity in 2020 was recorded in the neighbourhood centre sub-sector whereby, nationally, 41 neighbourhood centres were transacted for a combined value of $1.65 billion. The strong demand and performance of neighbourhood centres has continued into 2021, with already $1.39 billion being transacted in the first half of the year alone. As a result, the average yield per asset has seen a compression of 0.21 bps, sharpening from 6.04% in 2020 to 5.83% in 2021 (year to date).

Noosa Outlook was the only non-metropolitan neighbourhood shopping centre taken to market publicly in 2021, year to date. The rarity of the opportunity was quickly recognised by both private and fund capital and reflected in the competitive bidding that drove a benchmark result of a 4.99% yield. No other non-metropolitan neighbourhood shopping centre asset has yet transacted this year below 5.00%, regardless of price point or supermarket covenant.

“We are experiencing unprecedented demand from investors, both local and interstate seeking to deploy capital into ‘pandemic-proof’ assets such as a non-discretionary based neighbourhood centre, anchored by a national supermarket. The fundamentals of this retail asset sub-class are proving extremely resilient and Covid-19 conditions did not hinder the campaign in any way”, said Chris Maher, Director (QLD) of Retail Investment Services at Colliers.

Noosa Outlook is a freestanding, non-discretionary based neighbourhood centre which occupies a prime position in Tewantin, one of Noosa’s highest growth suburbs approximately 140km north of Brisbane.

The Centre is anchored by an award winning IGA on a brand new 10-year lease to 2031 with extensive options, and is supported by a strong, convenience based tenancy mix servicing the affluent local catchment. The fully leased Centre is the ideal passive investment having been recently refurbished and featuring a generous 5.5 year WALE with secure income growth as all tenants are on net leases and with annual rent reviews.

"We were fortunate to have so much genuine interest from buyers located interstate, particularly Melbourne and Sydney based investors. In the end, it was the Tasmanian based fund, GDA Diversified Property Trust who purchased, leaving many of the local buyers disappointed”, said Damon Lewis of Your Commercial.

Collier’s agents Chris Maher and Tom O’Driscoll are also currently marketing Oxley Village with the EOI closing Wednesday, 20 October 2021. 

To request a sales analysis please contact either of the selling agents Colliers’ Nick Dowling and Chris Maher or Damon Lewis of Your Commercial via the below contact details.