Local Investor ‘Locks Down’ Brentford Square Newsagency
CBRE’s Melbourne Strip Retail Investments team have transacted the Forest Hill Newsagency (29-31 Brentford Square) via an off-market process. The sale marks the 2nd transaction for the CBRE team over the past 6 months, rare activity given only 6 properties have sold within the tightly held precinct over the past decade.
A domestic investor secured the property, that has been operating as a Newsagency for 20+ years, for just shy of $2,400,000, reflecting a return of 3.51%.
CBRE’s Rorey James, Nic Hage & JJ Heng brokered the sale which was not publicly available to the market. CBRE’s Nic Hage noted “The Forest Hill Newsagency was sold in stage 1 (off-market) of a 2 stage marketing process that included a minor marketing investment to obtain professional photography, brochure design and ‘forthcoming’ signboard. We opted to take this strategic approach given the asset was marketed publicly through another agency over 2018-2019.”
Rorey James of CBRE added “The final price achieved was more than $250,000 above 2018-19 interest, highlighting that despite all the noise there is clearly a shortage of investment stock which is causing pent up demand for assets such as Forest Hill. This imbalance is resulting in great outcomes for vendors.”
James added, “Whilst a 3.5% return is historically considered sharp, there remains a strong appeal from buyers who have surplus funds, to take it from the banks and put it towards well leased commercial investments. It goes without saying, that in the current market length of lease and security behind the tenure are paramount criteria for investors.
In December 2019, CBRE transacted 484 Canterbury Road, Forest Hill, the former Caltex Service Station. The sale was part of a 25 property divestment strategy on behalf of Caltex who aimed to unload a tranche of sites that target the mid to low rise development market.