Melbourne family buys Sunshine Coast shopping centre on sub-6pc yield
Melbourne’s Zagame family has bought Poinciana Place Shopping Centre in Tewantin for $17.3 million on a yield of 5.9 per cent, a record for the Sunshine Coast.
Originally developed by Olympic swimmer Mark Stockwell’s Stockwell Group in 2006, the Woolworths-anchored shopping centre was subsequently acquired by an unlisted property investment fund established by Stockwell Funds Management in 2013.
Head of Stockwell Funds Management Andrew Dalton said the shopping centre had been a great asset for investors in the fund, and had delivered outstanding annual returns of 19.2 per cent and a return on equity of 54 per cent over a three-year period.
“The sale of the centre also provided our investors the opportunity to reinvest capital into other Stockwell investment funds underpinned by growth assets in the retirement living and inner-city riverfront owner-occupier apartment sectors, which are currently targeting returns of 15-20 per cent per year,” Mr Dalton said.
The Zagame family, which owns hotels and pub assets, could not be reached for comment.
The sales campaign for the 3106-square-metre centre was conducted jointly by Peter Rossi and Joe Tynan of CBRE, and Peter Tyson and Jon Tyson of Savills.
Growing confidence
Mr Rossi, who worked with Stockwell to establish Woolworths as its anchor tenant, said the deal attracted more than 260 buyer inquiries and reflected growing confidence in the Sunshine Coast property market.
Mr Tynan of CBRE said the joint agents produced 11 final bids for the centre in a competitive sale process.
“The centre proved popular with private investors and reflected the tight yield, continuing the trend of tight yields for this asset class.”
The centre is located in the “high street” of Tewantin and is anchored by the 2400-square-metre supermarket, with 10 specialty tenancies. It features open and undercover parking for 150 vehicles.
Savills’ Peter Tyson said the high level of investor interest in Poinciana Place was driven by the large weight of equity targeting the neighbourhood retail sector, the low cost of debt and the attractive lot size under $20 million.
“The record yield result was not surprising given centre dynamics, with supermarket trading performance above benchmark levels, no vacancies and long WALE [weighted average lease expiry] of eight years,” Mr Tyson said.
Woolworths’ initial lease expires in June 2026 with two further 10-year options, providing long-term income security.
