Westbridge in due diligence on Aspley's Coles centre at $55m

The report attributes the due diligence status to JLL. Until the sale is unconditional, either party can still withdraw or renegotiate, as the report describes it.

For Brisbane investors the headline is a Coles-anchored suburban centre changing hands at a reported $55 million, with the buyer saying the Coles lease has been extended to 2038. That lease detail comes from the buyer, as reported by The Urban Developer.

The numbers

The Urban Developer gives the following figures for the centre:

• Price: $55 million, which Westbridge puts at $4,825 per sqm of lettable area.
• Land: 1.94 hectares.
• Lettable area: 11,400 sqm (gross).
• Net income: about $3.74 million a year.
• Weighted average lease expiry: just over four years.
• Coles lease: extended to 2038, per the buyer.
• Rental guarantee: two years on vacant space, per the buyer.

The yield figures do not match. The buyer reports an initial yield of 8.01%. The Urban Developer says the net income from the sale campaign implies about 6.8% on the $55 million price. The report says Westbridge did not explain its figure, and suggests the rental guarantee or a different calculation method could account for the gap. We have not seen the underlying calculations.

According to the report, its last reported sale was in 2015, when Abacus Property Group sold it to Excel Development Group for $32.25 million. The Urban Developer says the current price is more than $20 million higher.

Promotional material cited by the outlet says the centre is being bought at about half its estimated replacement cost. The report notes that this claim is not independently verified, and we have not verified it either.

What’s next

The report says the expressions of interest campaign closed on 1 October. The deal now depends on due diligence finishing and the contract going unconditional. No settlement date is given in the report.

The Urban Developer does not name other tenants at the centre. For another supermarket-led centre story, see our Tasmanian shopping centre roundup.