Clarence Property sells Ormeau Marketplace for $34 million

A private investor has purchased Ormeau Marketplace from Clarence Property for $34 million.

The South East Queensland shopping centre, which is anchored by a 4,100 sqm full-line Woolworths supermarket, has a mix of six non-discretionary based retailers, along with allied health and medical tenants.

Ormeau Market is one of the first single (non-portfolio) neighbourhood shopping centres to have been sold in Australia since the RBA began lifting the cash rate in May. CBRE’s Joe Tynan and Michael Hedger brokered the deal with JLL’s Sebastion Fahey and Nick Willis.

The sale price reflects a yield of 5.24%.

“The quality of this asset attracted both onshore and offshore investor interest during the competitive off-market process, with the successful purchaser having a portfolio of similar assets across Australia,” Mr Tynan said.

“The sale of Ormeau Marketplace demonstrates the continued focus from groups seeking to invest in this asset class as a hedge against inflation.

“These neighbourhood centres, where the income is derived from non-discretionary retailers, can benefit from income growth via higher productivity and sales growth in an inflationary environment.”Joe Tynan, CBRE

Located 35 kilometres north of the Gold Coast CBD, the centre has a 11.5 year WALE with 87% of the income underpinned by Woolworths on a long term 20-year lease, which expires in 2035.

“The asset represents a very defensive income profile due to the limited specialty risk and the long-term leases, and is strategically positioned to capture the growing population within the northern Gold Coast corridor with the Main Trade Area to grow 21% by 2026,” added Mr Fahey.

“While the increasing cost of debt has caused some uncertainty with investors, we are still experiencing strong demand for quality prime convenience-based assets in tightly held locations.”

Clarence Property has recently changed the name of its $720 million flagship fund to Clarence Property Diversified Fund (CPDF), formerly the Westlawn Property Trust (WPT).

CPDF has increased its portfolio to 48 assets. Recent acquisitions include the additional 50% of The Rocket in Robina, which is an Australian Government asset in Port Macquarie.

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