Coles on shopping spree for supermarket sites in housing estates
Coles is on a buying spree, purchasing at least $67 million worth of real estate in the past 18 months, including retail sites in five of property developer Mirvac’s housing estates.
It’s the latest example of how the grocery giant is willing to use its balance sheet to invest in property to secure access to a catchment of shoppers in growth areas.
Property records show the supermarket chain bought a 1.53 hectare site in Googong, just outside Canberra, for $8.25 million in April from Mirvac, as well as another site in its Smith Lane project in Clyde North, about 46 kilometres south-east of Melbourne’s CBD, for about $17 million.
Mirvac announced earlier this year that Coles had bought its 6800 square metre town centre site in its Everleigh residential development, located in Greenbank, a suburb south of Brisbane.
Coles has also acquired a site in Mirvac’s residential estate Cobbitty in the eponymous suburb of NSW as well as its Olivine estate in Donnybrook, Victoria, which has yet to settle.
“Mirvac and its partners are working with Coles on five future town centres, and we will continue to lead the delivery of homes, key infrastructure and community facilities within these master planned communities,” a Mirvac spokesperson said.
Earlier this year the Australian Competition and Consumer Commission released the final report of its supermarket inquiry. It revealed Coles and Woolworths had acquired about 260 sites since 2019, but only notified the ACCC about 14 of them, or just 5 per cent.
The inquiry suggested Coles and Woolworths had advantages competing for retail sites because of their significant size, reputation and financial resources, highlighting how the two conglomerates, including Aldi, appeared to be among the most profitable supermarket chains globally.
A Coles spokesperson said the company was constantly evaluating its store network to ensure it was delivering the best shopping experience for its customers.
“As part of that process we are excited about delivering new supermarkets for these growing communities,” they told The Australian Financial Review.
“Our teams are now in the process of working through the specific development applications for these sites, and we are looking forward to getting them under way.”
Outside the Mirvac portfolio, Coles has also purchased a 1.55 hectare site in Tahmoor, located in NSW’s Macarthur region, for $14 million with plans to develop a new supermarket shopping centre. Two local investors amalgamated 16 house lots in 2008 and have been preparing the site for development over the past 17 years.
JLL’s Sebastian Fahey and David Mahood brokered the off-market deal of the Tahmoor Town Centre.
“Tahmoor Town Centre is the only major shopping centre in the precinct and there has been very limited retail development in the catchment since this was originally developed,” Fahey said.
“The local community will be delivered a best-in-class shopping centre that will service the growing demand from the Tahmoor catchment.”
Coles also has plans to replace an IGA in Sydney’s south-west after acquiring the 2.2 hectare site for $28 million in April. While in the early phases of planning, it aims to redevelop the existing Austral Shopping Centre to include a Coles supermarket, liquor store, a retail floor which can be divided into 17 tenancies, and a parking lot.
