"The rarity of the offering, combined with its size, prime position and high profile tenants make it a quintessential landbank opportunity."
There are few tenants as highly valued as Bunnings Warehouse. The Wesfarmers-owned chain of household hardware stores produced nearly $37 billion in revenue this past financial year, and its brand is so synonymous with home improvement that it possesses approximately 50% of the Australian DIY market share.
That's part of the reason why investors are driven into a frenzy each time one of these assets reaches the market: it represents a source of stability. In 2018, Bunnings Glenorchy in Tasmania sold for a price reflecting a tight 3.12% yield. Earlier this year, a Bunnings outlet in Swan Hill was transacted for just over $18 million, generating a 3.99% net passing yield. More recently, October saw a foreign investor part ways with $79 million to acquire a Bunnings in Hoppers Crossing on a 3.95% yield.
409-419 Sydney Road, Brunswick VIC 3056
As such, it should pique the interest of many investors that the Bunnings outlet located on Sydney Road in the middle of the popular northern suburb of Brunswick is finding its way to market, thanks to a campaign that's being orchestrated by Melbourne Acquisitions’ James Latos and Dominic Gibson.
According to Mr. Latos, the sheer scale of the site is rare for the area, giving this listing a point of significant distinction. "The rarity of the offering, combined with its size, prime position and high-profile tenants make it a quintessential landbank opportunity," he explained.
"The property is one of only 3 remaining sites in Brunswick over 3,500sqm in size that is not currently in planning or construction."
In addition to the Bunnings store, the listed property also features an Australia Post outlet. Given the country's most prominent postal service is government-owned and backed, 409-419 Sydney Road comes replete with some of the most stable tenants available.
409-419 Sydney Road, Brunswick VIC 3056
Currently, the collective rent provided by the two businesses equates to $455,336 in annual return, and with guaranteed rental increases, the successful buyer will have exposure to as secure an asset as the market is providing.
Brunswick and its surrounding suburbs have served as a hotspot for both first-rate sales and notable development applications in the past year. The vacant 1,010 sqm site at 253-259 Brunswick Road was purchased for $5.35 million in September of this year, whilst back in July, 251-265 Lygon Street was transacted for $11.25 million thanks to a campaign run by Melbourne Acquisitions, generating a considerably tight yield of 1.1%. If anything is evident, it's that competition between investors is proving fierce.
Melbourne Acquisitions' Expressions of Interest campaign is set to conclude on Wednesday the 16th of December, and is expected to draw significant investor interest. For those seeking an ideal landbanking asset, Brunswick's 409-419 Sydney Road ticks all the boxes.
View Melbourne Acquisitions' latest listings on CommercialReady here.
