Colliers and Stonebridge have recently sold Pakington Strand Shopping Centre in Geelong West, selling on a benchmark yield of sub-5.5%. The sale was managed by Colliers’ Tim McIntosh and James Wilson in conjunction with Stonebridge’s Kevin Tong and Justin Dowers on behalf of APH Holding who acquired the centre in 2016.

Located in Victoria’s largest regional city, the 5,317 square metre centre comprises a full-line Woolworths supermarket supported by 13 specialty tenants on a 2.1 hectare mixed-use site with 307 car spaces.

Pakington Strand is located only 2km from the Geelong CBD and 76km south-west of the Melbourne CBD. The centre is positioned on the Pakington Street retail strip, boasting a long-WALE [weighted average lease expiry] of 12.4 years by area and returning a fully leased net income of approximately $1.7 million at the time of sale.

APH Holding held the property for almost eight years, releasing it to the market with full tenancy, including anchor tenant Woolworths and household names such as Subway and Brumby’s.

With this sale, APH Holding will begin 2024 with a renewed focus on the City Park Masterplan in Melbourne’s East with the first stage, a new retail experience, starting construction later this year.

Colliers’ Tim McIntosh said, “The benchmark result and depth of interest in Pakington Strand from private and offshore investors, listed and unlisted groups as well as developers reinforces the resilient buyer demand for well credentialed Victorian neighbourhood shopping centres.

“The centre was unconditionally sold to a high net worth private investor on a yield below 5.5% shortly after a two-round process at the end of the campaign.”

The campaign generated in excess of 300 inquiries across both agencies with a dozen offers received at the close of the campaign.

Stonebridge’s Kevin Tong commented, “We continue to field strong depth of buyer interest from local and offshore investors as 2023 saw another year of limited neighbourhood shopping centre opportunities offered publicly on the market. Although the purchaser was based in Victoria, we witnessed strong competition from offshore investors with multiple groups forming our underbidders.”

In 2023, there were only five recorded sales of neighbourhood centres across Victoria, 40% down on the 10-year Victorian average and consistent with the national theme showing a 43% reduction in transaction volumes over the same period.