Brisbane commercial property investment
Below are some big deals that have happened recently in the Brisbane commercial property investment market. We can use these to give us an idea of what’s hot around town.
Major retail transactions in the Brisbane commercial property investment market for final quarter of 2017
The final quarter of 2017 saw $1.325 billion in major retail transactions around south east Queensland. Centres sold included –
- Benowa Village (Gold Coast) – sold for $49.5 million on a 5.08% yield (record low yield)
- Peregian Springs Shopping Centre (Sunshine Coast) – sold for $41.5 million on a 5.35% initial passing yield
- Albany Creek Square (northwest of Brisbane CBD) – sold for $56 million on a 6.96% initial yield
The good news for investors is that we saw a decline in shopping centre vacancies in 2017. Brisbane recorded a 5.5% vacancy rate in June 2017 but this tightened to 4.5% in December 2017. However, owners and managers of shopping centres still need to work hard to attract and retain tenants.
Chinese investor snaps up Deagon Shopping Centre for $23.3 million
The suburban shopping centre is a popular Brisbane commercial property investment. A Chinese investor bought Deagon Shopping Centre at the beginning of 2018 on a net yield of 6.95%. The modern centre is fully leased and anchored by an IGA supermarket. The net lettable area is 6,004sqm.
Springfield Fair Shopping Centre sells for $23.5 million
Another major Brisbane commercial property investment deal was also seen in Springfield in early 2018. The retail centre sold to AM Australia Retail Property Fund on a yield of 7.05%. Charter Hall Retail REIT sold the property as it is divesting smaller retail assets within its portfolio, instead choosing to focus on larger, higher growth properties. Springfield is located 22km southwest of Brisbane CBD. The centre is anchored by Coles supermarket and has a net lettable area of 6,318sqm.
Brisbane office market is heating up
Researchers are saying that the Brisbane office market offers net effective rental growth for 2018-2023. This in part is being driven by the growing white-collar employment market (Brisbane is growing the second fastest in Australia). The Brisbane office investment market has been attracting new investors and foreign capital due to the attractive yields. Currently, Brisbane has a higher comparative yield than the Sydney and Melbourne markets. However, Brisbane has a much higher vacancy rate than Sydney and Melbourne.
Mirvac update development application to build a 31-storey office tower
Mirvac have just lodged an application to develop a commercial office tower at 62-80 Ann St in Brisbane City. The original development proposal was for a 36-storey student accommodation tower. However, the new proposal has changed and the key stats are listed below:
- The site is 5,482sqm
- Mirvac bought the site from Singaporean developer Wee Hur Holdings at the end of 2017
- Woods Bagot have designed the proposed 31-storey office tower with ground level retail and service space
- The proposed office tower will have total gross floor area of 72,540spm and office floor plates of greater than 1,500sqm net lettable area
- This proposal lines up with Suncorp Group’s announcement that they are looking for a large site to consolidate their offices (they currently have 3 around Brisbane making up 38,000sqm).
Famous yachtsman is selling two major Brisbane office towers
Peter Harsburg, famous for sailing the Sydney to Hobart, is selling his last two Brisbane City office towers. The properties are located at 260 Queen Street and 95 North Quay. 260 Queen Street has a net lettable area of approximately 13,300sqm and offers podium floor plates at 1,000sqm over 20-storeys. This property has been anchored by Westpac since the building was constructed. Westpac still occupy 65% of the building and have a retail offering on the ground floor. 95 North Quay offers 8,710sqm of A-grade net lettable area currently occupied by legal professionals. The building is tenanted at 58%.
Aged care developments are increasing
2018 has seen two major developers announce their intentions to develop aged care precincts in Brisbane. Lendlease are intending to develop one at Doomben and Pikos Group have just lodged an application for one in Woolloongabba. Lendlease entered into an agreement with Brisbane Racing Club to develop an integrated retirement and aged care precinct overlooking the Doomben Racecourse. This will be the company’s first foray back into aged-care development after exiting the sector in 2013. Pikos Group are intending to develop a 10-12 storey integrated health and aged care facility at 52-64 Annerley Road, Woolloongabba.
And now that we’ve got you interested in Brisbane commercial property investment assets, why not have a look at Blocksidge’s current commercial properties for sale or for lease.
Sources:
The Australian Financial Review – Real Estate
