Bunnings Albion Park sold for $40.6 million by CBRE

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Nov 21, 2024

Bunnings Albion Park sold for $40.6 million by CBRE

Bunnings Albion Park sold by CBRE Senior National Director of Retail Capital Markets – Australia, James Douglas on behalf of Charter Hall, with Costi Cohen’s Tas Costi and Jacky He acting as the buyer’s agents and transaction advisor.

CBRE

Bunnings Albion Park sold by CBRE

An unlisted fund managed by Charter Hall has exchanged contracts to sell Bunnings Albion Park to a high net worth foreign investor for $40.6 million

CBRE Senior National Director of Retail Capital Markets – Australia, James Douglas handled the off-market sale of the regional New South Wales property on behalf of Charter Hall, with Costi Cohen’s Tas Costi and Jacky He acting as the buyer’s agents and transaction advisor.

Mr Douglas said the sale highlighted the continued high demand for this style of retail asset type and lease covenant.

“Despite the lack of recent transactions, Bunnings stores remain highly sought-after by a broad range of investors due to the typically long-term nature of the leases and inbuilt fixed annual rental growth,” Mr Douglas noted.

“It is an interesting period in the market for highly secure, single tenant ‘bond style assets’, with some investors targeting assets with predictable returns higher than where they believe the cash rate is forecast to settle over time.”

Opened in 2018, Bunnings Albion Park occupies a highly strategic 32,000sqm site on the Princes Highway, 110km south of Sydney, and offers a gross lettable area of 13,120sqm, with parking for 344 vehicles.

The asset provides a WALE of ~6 years, with extensive option periods to 2078.

The transaction, struck on an initial yield of 4.89%, represents the largest Bunnings Warehouse sale in New South Wales in over three years and the largest nationally since early 2023.

Costi Cohen’s Tas Costi said, “Our client recognised the long-term security and strong growth potential offered by this exceptional Bunnings asset. The strategic location, coupled with a high-quality tenant like Bunnings, provides a stable income stream and aligns perfectly with our client’s focus on assets that offer both security and future value. This acquisition highlights the continued appeal of well-located, premium-grade properties in Australia’s commercial landscape.”

Mr He, who leads leading Costi Cohen’s Asia Markets division, noted, “Asian investors are increasingly seeking generational assets with reputable tenants like Bunnings, whose strong covenant and proven market resilience make them ideal for high-growth areas like Shellharbour. NSW’s South Coast region, including Shell Cove, West Dapto, Calderwood, Tulimbar, and Albion Park, is undergoing rapid urbanisation with 19,500 dwellings to be delivered over the next 50 years in the West Dapto precinct alone. This transformation solidifies the region’s position as a prime destination for long-term capital growth.”