Record low yields achieved with 7- Eleven service station sales

Record low yields achieved with 7- Eleven service station sales
Record low yields achieved with 7- Eleven service station sales

Two 7-Eleven service station and convenience store investment properties have sold at auction achieving record low yields for the sector.

The first property at 154-158 St Kilda Road, St Kilda (above) sold for $10.2 million, reflecting an initial net yield of just 2.73 percent.

The other 7-Eleven at 786 Whitehorse Road, Box Hill sold for $8 million, showing an even lower yield at 2.14 percent. 

Both properties were purchased by off-shore investors and the combined price exceeded the vendor's reserve.

JLL's Directors of Retail Investments Stephen Bolton and Stuart Taylor handled the campaigns 

"We expected the high profile properties to achieve strong results based on the enquiry levels received throughout the campaign," Stephen said.

"Both properties attracted a mix of buyer types, comprising local, interstate and off-shore investors.” 

“The strength and security of the lease covenant to 7-Eleven and continued strong growth of 4 percent per annum helped push investors to these prices. 

The assets featured brand new 15 year leases to 7-Eleven with an option for a further 15 years.

The sub 3 percent yields are a record for the sector and support the ongoing yield compression for prime retail investments in the Melbourne market”, Mr Bolton added.  

These actions follow the recent sale of the Liberty service station at 151-159 Victoria Parade, Fitzroy, which sold for $9,600,000 reflecting an initial yield of 1.53 percent.

The 1,684 sqm property, currently operating as a Liberty Petrol station benefited from a long term lease until March 2017  and a one 5 year lease option. 

 

Tags: 
Commercial Sale

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