Electrical and appliance retailer The Good Guys has secured leases across nine separate bulky goods retail properties spanning four states for a combined $92 million.
The transaction, headed by Savills, represented the largest group transactions of its kind in the Australian market this year.
The properties are located in Victoria (Thomastown, Geelong, Bendigo and Ballarat), New South Wales (Caringbah and Ballina), Queensland (Ipswich and Cairns) and Western Australia (O’Connor).
The sale prices range from $5,200,000 for the Bendigo property, up to almost $30,000,000 for the Caringbah property. Purchase yields range from around 6.25% for the capital city properties up to almost 8% for regional properties – compelling returns for a yield starved market.
Savills Directors Clinton Baxter, Nick Peden, and Steven Lerche said the sale had been one of the most anticipated divestments of Australian retail stock of the last 12 months.
"Of the retail properties that have come to market in recent times none that have offered such a combination of geographical diversity, with exceptional underlying land value and a blue-chip tenancy profile," Baxter said.
"We expected strong interest from private investors seeking individual properties, but were particularly surprised by the numerous portfolio buyers seeking multiple properties across several states.
“We simply couldn’t satisfy all the portfolio offers due to overlapping property requirements, and ultimately chose to transact 5 of the properties with a Sydney-based investment fund and sell the other properties individually," he said.
Peden said that the wide price range of the assets, exceptional main road locations in key commercial precincts, attractive rental returns, together with blue-chip tenancy profiles appealed to a wide range of investors ranging from SMSFs, private investors, syndicators and property funds, whether based locally or off-shore.
The properties are all owned by the Muir family.
“Of the original portfolio of properties we have been handling for the Muir family, it was crucial to the process that we finalised the single portfolio transaction before allowing individual properties to be sold," Baxter said.
"Now that has occurred, we are busy transacting the individual properties, with the opportunity offering exceptional value for investors at attractive yields.”
The Good Guys was founded in Melbourne’s northern suburbs in 1952, and remained a family-owned business until late 2016 when the company was purchased by JB Hi-Fi Limited for $870 million. The business has grown to be one of Australia’s leading retailers in the sale of white goods and electronics, with an approximate annual revenue of $2.1 billion.