Clyde North retail centre sells for $18.65m as Stonebridge cites decade-high building rate
A private investor has acquired Meridian Village Lifestyle Centre in Melbourne’s fast-growing south-east for $18.65 million, completing the $42.6 million sell-down of Griffith Group’s retail development in Clyde North.
The newly developed, nationally leased retail centre attracted multiple on-contract offers and changed hands before the expressions of interest campaign closed, and, according to Stonebridge Property Group, achieved the highest building rate for a large-format retail centre transaction in Victoria in more than a decade.
Set within the $1 billion Meridian Estate master-planned community, the centre changed hands on a 5.63 per cent fully leased yield, equating to a building rate of $6844 per square metre.
Record building rate highlights investor demand
Stonebridge Property Group’s Justin Dowers, Kevin Tong and Rorey James negotiated the acquisition of the asset at 50 Titan Drive.
Meridian Village Lifestyle Centre is home to Australia Post, Supercheap Auto, Petbarn, Jaycar, Nutrition Warehouse and a dog wash kiosk, with 85 on-site car spaces and leases underpinned by fixed annual rental increases.
Completed last year, the centre spans 2725 square metres across an 8047-square-metre site within one of Melbourne’s residential growth corridors, 55 kilometres from the CBD.
$42.6m Meridian Village sell-down completed
The transaction marks the third and final sale within the broader Meridian Village retail development positioned on the corner of Thompsons Road and Matterhorn Drive, following the disposal of a free-standing Mexican fast-food chain Guzman y Gomez at 9 Matterhorn Drive and the adjoining Dan Murphy’s bottle shop and childcare Nido Early School assets at 7 Matterhorn Drive.
Stonebridge sold the Guzman y Gomez for $5.9 million on a 4.65 per cent yield last October, followed by the Dan Murphy’s and Nido Early School for $18.05 million at a 5.5 per cent yield in November.
Dowers, national partner at Stonebridge, says the three transactions delivered a strong outcome for Griffith Group, with the sell-down generating a combined $42.6 million.
“The Lifestyle Centre result was particularly strong, with multiple on-contract offers received prior to the close of expressions of interest and the eventual sale achieving the highest building rate for a large format retail centre in Victoria in more than a decade,” he says.
“Across the three assets we saw strong competition from private capital, with the development ultimately transacting at a blended yield of approximately 5.44 per cent.”
The retail assets form part of Median Estate, a still-expanding master-planned community by Brown Property Group, expected to comprise about 3000 residential allotments upon completion.
Already home to around 2000 families, the 266-hectare estate features parks, wetlands and community infrastructure and continues to expand alongside significant residential and commercial developments in Clyde North.
The centre sits amid a wider multibillion-dollar development pipeline that includes Mirvac’s $1.34 billion Smiths Lane community, the 4000-home Orana estate, the Kmart-anchored St Germain Hub and the emerging 317-hectare Croskell employment hub in nearby Cranbourne.
Large-format retail continues to attract capital
Australia’s large-format retail sector has evolved from a fringe property category into an increasingly sought-after asset class, as institutional investors pursue defensive income, low vacancy and constrained new supply.
Tong, partner at Stonebridge, says large-format retail continues to benefit from strong investor demand and a shortage of quality opportunities.
“Large format retail continues to be one of the strongest-performing segments of the retail investment market, with both private and institutional capital actively seeking exposure to the sector,” he says.
“The Meridian Village result reflects the premium investors are placing on newly developed assets with strong tenant covenants, long-term income security and exposure to Melbourne’s high-growth corridors.”
Large-format retail has delivered average annual investment returns of 12.8 per cent over the past decade, fuelling strong investor demand, while CBRE forecasts returns of 11 per cent by 2030.
Recent transactions have underlined the sector’s resilience, including the $86.025 million sale of Chadstone Homemaker Centre in January, Victoria’s biggest large-format retail deal since 2021.
James, partner at Stonebridge, points to another recent deal, with Sunbury Lifestyle Centre selling for $25.2 million.
“Both campaigns attracted strong interest from investors, particularly for modern centres offering national tenant covenants, strong population growth and limited near-term capital expenditure,” he says.
Population growth underpins Clyde North investment appeal
Population growth remains a key driver of investor interest in Clyde North and Melbourne’s broader south-east corridor.
According to the City of Casey, Clyde North’s population is forecast to surge by almost 68 per cent, from 68,000 residents to more than 114,000 by 2046.
The suburb is expected to accommodate at least 46,000 additional residents over the next two decades, supporting demand for new retail, convenience and lifestyle infrastructure.
