‘Jenke Park’, a 6,612 square metre site on the corner of Drakeford Drive and Athllon Drive, has sold for $18.1 million.
The site features four tenants: Snow Gum Early Childhood Learning Centre, Hungry Jacks, Club Lime and TLE Electrical, as well as 40 car parking spaces.
The business was sold with a healthy weighted average lease expiry (WALE) of 11.43 years and an established fully leased net income of $995,651 per annum.
The property was sold by JLL Property, after being constructed in 2018.
The high price represents the convenience retail boom occurring nationwide since 2020.
Director at JLL Property (NSW) Gordon McFayden suggested there is a level of security in investing in convenience retail compared to other investments at present.
“The lure of these sites come from their income security and resilience to economic downturns, and the market is reacting accordingly. The current low-interest-rate environment combined with low supply is driving investor demand and, in turn, yield compression for these types of assets in NSW,” said Mr McFayden.
Fellow Director at JLL Property (NSW) Dylan McEvoy said it draws all different types of investors.
“Roadside retail assets attract investors with their national tenants, lease structure, secure guarantees and typically fixed income growth. These assets are often located in high profile/exposure positions which lend the assets to long term redevelopment potential if tenants ever left,” said Mr McEvoy.
Tuggeranong Community Council President Jeffrey Bollard said that the council “would always welcome investment in the region”, as long as that investment came with an understanding of the requirement of upholding community values.
While somewhat surprised at the sale price, Mr Bollard acknowledged that the area is a “hive of activity” with the local school and shopping centre also nearby.