Veteran Queensland developer Nic De Luca has put a brand new Bunnings warehouse in Kingaroy, north-west of Brisbane, up for sale with an asking price of about $14 million.
Mr De Luca, who has completed 24 projects for the Wesfarmers-owned DIY chain over the past 11 years, said it was a good time to sell the property given a “flight to retail property on good covenants” by investors amid the housing downturn.
“There’s been a shift to retail and commercial investments,” he told The Australian Financial Review.
The 7600-square-metre, medium-size format Kingaroy Bunnings was developed on a 2.4 hectare portion of a 3.66 hectare site acquired by the De Luca Group last year for $2.43 million.
The new warehouse, which is being marketed by Billy Holderhead and Glenn Conridge of Burgess Rawson, is due to open on May 31 with an official launch on June 4 where former Australian opening batsmen Matthew Hayden, who grew up in Kingaroy, will cut the ribbon.
The new Bunnings is being offered for sale with a 10-year lease, bringing in annual rent of $800,000.
“Supply is extremely light on and demand is extremely hot for Bunnings freehold investments,” said Mr Holderhead.
“Only four freestanding assets hit the open market last year, they sold for a combined $70 million at an average yield of 4.67 per cent, including the record 3.13 per cent yield we achieved for the Glenorchy (Hobart) freehold in December. None have sold yet in 2019,” he said.
Kingaroy, an agricultural town 155 kilometres from Brisbane, is known as the “Peanut capital of Australia” and has a population of about 31,000.
Mr Holderhead said an added appeal of the Kingaroy Bunnings was the 3190 sq m of expansion land that gave room for the store to expand in the future.
“Only two of the 14 Bunnings to hit the open market since 2017 included land for on-site expansion,” he said.
The most recent sale of a brand new Bunnings was a mega store (including additional large format retail space) in Port Macquarie, which sold last year to fund manager MPG for $44.65 million.
Keep up with Commercial Real Estate news.