Hawthorn Woolworths deal shows supermarkets still market darlingsThe Woolworths supermarket in Hawthorn, Melbourne.

Hawthorn Woolworths deal shows supermarkets still market darlings

People still have to eat, no matter how high inflation climbs. Now, the Woolworths supermarket in the old Glenferrie Market complex has fetched $12.85 million on a sharp yield of 3.3 per cent.

The yield is a record low for a strata supermarket, which obviously lacks the development potential that a freestanding property represents.

The 1827-square-metre supermarket is in a prime location in a small shopping centre next to Glenferrie railway station and Swinburne University.

The area is in the heart of Melbourne’s new apartment corridor, in the leafy eastern suburbs, and teems with students in more normal times.

Stonebridge Property Group agents Justin Dowers, Kevin Tong and Julian White acted for the private family that was selling the asset after 15 years. They declined to comment on the buyer or the vendor.

But records show that, in 2007, Diamen – part-owned by investor Jimmy Goh at the time – paid $7 million to the centre’s developers, David Frid and Michael Kahane.

Dowers said the campaign drew strong interest from a wide buyer pool, with investors keen to purchase a strata supermarket that could be bought for less than stand-alone properties.

The strength of the freestanding market has been demonstrated in a series of local transactions over the past 12 months. The nearby Coles changed hands for $24.5 million, reflecting a 1.9 per cent yield, while Balwyn Woolies fetched $45.7 million on a 2.99 per cent yield. Another Woolworths, in Blackburn South, sold for $29.3 million on a yield of 2.47 per cent.

Tong said: “Traditionally, supermarkets in Melbourne’s east have been highly sought by Asian investors, and Woolworths Hawthorn was the same. The strong level of inquiry from Asian buyers was driven by the location, which they are familiar with, and the blue-chip Woolworths covenant.”

CBD banks

In more news on the bank branch merry-go-round, ANZ has shifted out of the flagship branch in Collins Place that it had occupied since the towers were built in 1981.

In a deal brokered by Ainsworth Property’s Josh Luftig, Tan Thach, Zelman Ainsworth, the bank turned on its old 900-square-metre banking chamber and took 200 square metres down the street at 100 Exhibition Street.

With thousands of office workers missing from the Paris end of the CBD, there was presumably nothing like the finance traffic the branch once processed.

As well as shifting branch freeholds off their balance sheets, banks are dumping old leases and making the most of the reduced rents on offer in the current market.

NAB, which previously occupied the space at No.100, at the foot of the Mantra Hotel, has moved around the corner to the old McDonald’s space at 24 Collins Street.

Deeper into the CBD’s retail core, Bendigo Bank has vacated its space in the Block Arcade’s secondary entrance and taken up TM Lewin’s former digs at 356 Collins Street, while the Bank of Melbourne has moved out of 233 Collins Street.

A-P’s Ainsworth is now marketing that address, held for many years by the Bank of Melbourne, as an upmarket boutique space.

Beachie abode

The Australian Property Institute, a lobby group for valuers, is offloading its office building on the Port Melbourne waterfront.

The double-storey Victorian at 10 Beach Street is on 385 square metres of land overlooking the dog beach and around the corner from the Bay Street retail strip.

API bought the property more than 30 years ago for just $723,000. It is expected to fetch more than $5 million.

The lobby group has appointed Greville Pabst as transaction adviser, while Colliers’ Anthony Kiran, Daniel Wolman, Alexander Leggo and Joff Mithen will handle the deal.

“We believe 10 Beach Street to be the only freestanding beachfront office building in the City of Port Phillip. The genuine scarcity of this offering makes it an exciting prospect,” Kirwan said.

“The property is subject to favourable mixed-use zoning that permits both office and residential uses. There’s also legitimate potential for a prospective purchaser to add additional levels to the building,” Pabst said.

The API has relocated to the CBD and will use the funds for training and education purposes, API boss Amelia Hodge said.

The fringe suburb is very popular. A three-level building around the corner at 270 Bay Street recently sold for $3.7 million on a 2 per cent yield.

An owner-occupier snapped up the unrefurbished property in a deal handled by CBRE agents Nathan Mufale, Scott Hawthorne, Alex Brierley and JJ Heng.

Corio Medical

Australian Unity has emerged as the buyer of the Corio Medical Clinic in Corio, on the outskirts of Geelong, paying $9.5 million.

The 1324-square-metre building is on a huge lot of 6700 square metres at 1 Bacchus Marsh Road, with a head lease to Better Medical.

Better Medical and other tenants pay about $430,000 a year in rent, giving the deal a yield of about 4.5 per cent.

The property, which includes three houses and room for 74 parked cars, is clearly suited for further development.

Stonebridge agents Rorey James and Kevin Tong handled the transaction after it hit the market in September 2021.

Tong said interested buyers were attracted to the better returns generated by regional investments and the 50 per cent saving in stamp duty.

“They also have a great deal of confidence in regional areas off the back of the pandemic and more people now living permanently there,” Tong said.

Strata deals

The lawyers who owned level 2 of 326 William Street, overlooking Flagstaff Gardens, have doubled their money after selling their large 527 sq m whole-floor office for $3.5 million.

The Berger Kordos Lawyers family law practice shut up shop in the middle of 2021 after 16 years, according to its website, with the Kordos Lawyers side of the equation merging with ASX-listed Australian Family Lawyers.

The Berger side of the operations became Dignity Legal and is set to focus on mediation and non-adversarial dispute resolution.

Records show the partners’ investment company, Bervk, bought the office in 2009 for $1.7 million.

An attempt to sell vacant last year failed to find a willing buyer, but the space has now been leased to Australian Family Lawyers.

Colliers agents George Davies, Anthony Kirwan and Tanisha Seeling handled the campaign, which yielded three offers. The property sold on a generous 5 per cent yield to a syndicate looking for a passive investment.

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