$53.59m in properties sold under the hammer at Cushman & Wakefield Portfolio Auction

Michael Collins • 11/11/2020

Cushman & Wakefield has today announced the sale of eleven commercial properties for a combined value of $53.59 million, during the largest national portfolio auction held in Sydney during 2020.

The auction was led by a portfolio of six Woolworths Caltex branded fuel and convenience assets individually sold under the hammer for a total of $40.235 million, with the seventh asset in advanced stages of negotiation. The broader portfolio also included a range of retail, childcare and medical assets located in Queensland and New South Wales.

The auction, held by Cushman & Wakefield’s National Investment Sales team, achieved a 73% clearance rate with the majority of assets in the portfolio being sold significantly above reserves. In a further sign of yield compression, the Burwood Woolworths Caltex service station was sold for $8.9m at a near-record 3.71% yield, and two retail properties in Freshwater recorded yields of 4.11% and 4.28%.

The portfolio attracted more than 950 inquiries heading into the auction, with more than 150 people attending the auction in-person in Sydney and Brisbane, with bidding also conducted via phone and online. The properties were sold to a range of private and high net worth investors from local areas and interstate plus two funds management groups.

The Woolworths Caltex branded portfolio included assets in Chatswood, Burwood, and Byron Bay in New South Wales, Bowen Hills Brisbane and Aitkenval, Townsville in Queensland, and Bakewell in the Northern Territory. All properties were sold with newly signed 15-year leases in place. The sale prices ranged from $3.84 million to $9.1million, with yields between 3.71% in Sydney, 4.41% in Byron Bay, 5.96% in Brisbane and 6.25% in Townsville.

Other assets in the portfolio included healthcare, food and retail properties in Sydney’s North Shore, Northern Beaches and a medical investment in Casino, New South Wales. Two Brisbane based childcare centres within the portfolio sold prior to auction.

Cushman & Wakefield’s Michael Collins, Aaron Dahl, Yosh Mendis, Geoff Sinclair and Tom Moreland managed the sale campaign, with the auction conducted by Damien Cooley from Cooley Auctions.

Cushman & Wakefield’s Head of National Investment Sales, Michael Collins, said: “With most assets selling well above reserve, the auction delivered an outstanding result for our vendors. Overall, investors sent an overwhelming signal about their confidence in the alternative real estate investment market.”

“The sale of six sites within the Woolworths Caltex branded portfolio is further evidence that the fuel and retail convenience sector continues to run hot. With an overwhelming level of interest in the portfolio, and a large number of active bidders, these assets set the pace for a very competitive auction."

“Private and high net worth investors have continued their active search for yield during the pandemic and are targeting defensive investment opportunities backed by high quality, long-term leases. The low yields recorded across many sites reinforced the yield compression we are seeing among these types of assets and reflective of the lower for longer interest rate environment.”

“In particular, the market for fuel and convenience retail property has been among the best-performing alternative asset classes, with values remaining highly robust throughout the pandemic.” Mr Collins concluded.