Buy one or buy four – Retail strip in the Melbourne’s booming south-east set to go under the hammer

Published on: 16 February 2021

A quartet of affordable retail and essential service properties alongside an Aldi and Chemist Warehouse in one of Victoria’s strongest growth locales shape as a tantalising proposition for investors.

The Hampton Park properties, to be sold individually at Burgess Rawson’s Investment Portfolio Auction this month, comprise a dental clinic, medical centre, Bottlemart liquor store and pizza shop – all well-established and with attractive leases.

Returning rentals between $40,000 and almost $50,000 per annum, plus GST, the properties are expected to hit the “sweet spot” for many buyers – between $650,000 and $900,000 and with yields of around 6% – according to Burgess Rawson director Shaun Venables.

Mr Venables said their location, anchored by a neighbouring Aldi supermarket and Chemist Warehouse, continued to benefit from dramatic population growth.

“Hampton Park is within one of Melbourne’s fastest-growing metropolitan corridors, there’s no question about that.

“These properties sit within a reasonably established yet growing position, so investors can take advantage of what is already there, plus what’s to come.”

The near-new properties feature high quality tenant fitouts, with leases running until 2023 (dental clinic), 2025 (Bottlemart and medical centre) and 2030 (pizza café), all with options and fixed rent increases of between 3-4%.

Mr Venables said all four properties fall within some of the best-performed industries and asset classes nationally over the past 12-24 months.

“Throughout 2020 people have been desperately trying to acquire essential service investments,” he said.

“Medical and dental both fall under that category, and you could argue that liquor and fast food do also. Liquor has been trading at about 30% above normal levels.”

“These properties are separately titled but they do integrate with the major retailers next door. It’s important for these sorts of properties to have an anchor, and in this instance you’ve got Aldi and Chemist Warehouse, and everybody knows they draw large numbers of patrons.”

Burgess Rawson’s 142nd Investment Portfolio Auction will be held at Melbourne’s Crown Casino from 11am on Wednesday, February 24.

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