Rose Powell | Ruth Liew
Developers are leasing former Bunnings showrooms by tapping into strong demand from rival hardware retailers, as demand for well-located, large-format retail space grows amid the home-building boom.
In Melbourne’s north-west, Ballarat developer H. Troon has signed a 716-square-metre retail leasing deal with the Sunbury Mower and Chainsaw Centre at its Sunbury Showrooms in what was the former Bunnings Sunbury store.
Rents at the centre on Vineyard Road range from $165 to $250 a square metre. The centre has a weighted lease expiry of almost eight years.
The Sunbury Mower and Chainsaw Centre will join The Good Guys, Total Tools, Repco and Godfreys in the 5544-square-metre large-format retail centre, which is across the road from where Bunnings has committed to a new 13,000-square-metre large-format store.
In Maribyrnong in Melbourne’s inner west, Harvey Norman has struck leases with Anaconda, Beacon Lighting and Curtain Wonderland in another redeveloped former Bunnings warehouse, across the road from GPT’s Highpoint Shopping Centre and down the road from a new large-format Bunnings store.
The deals have come about as Bunnings leaves its smaller 6000 to 9000-square-metre stores for the new larger-format stores ranging from 14,000 to 21,000 square metres, as it battles for greater dominance of the $19 billion hardware market. Bunnings plans to open 40 new stores over the next two years.
CBRE’s head of large-format retail Chris Parry, whose team negotiated the leases, said Bunnings’ decision to relocate to larger premises was providing landlords with the opportunity to earn a higher return from the freehold premises.
“With Bunnings expanding its footprint across Australia, we envisage there will only be more opportunities such as this in the growing large-format sector,” Mr Parry said.
A third former Bunnings warehouse in Burleigh Heads, on the Gold Coast, is also being repositioned as a large-format retail centre, with a pre-leasing campaign being run by CBRE.