Cushman & Wakefield have announced the $18 million+ sale of a Medical Centre situated at Coorparoo, some four kilometres south east of the Brisbane CBD.
The property, located at 332-342 Old Cleveland Road in Coorparoo comprises a 2,496 square metre land holding with a net lettable area of 1,607 square metres.
The property was sold fully leased with a Weighted Average Lease Expiry (WALE) of seven years and net income of approximately $1.130 million per annum.
Tenants include Sonic Healthcare subsidiary, QLD X-Ray, Terry White Pharmacy, Primary Healthcare’s QML, and the Coorparoo Clinic doctor’s surgery.
The site has been a pharmacy location for 60 years. Cushman & Wakefield Managing Director Glen Wright said the transaction is another example of strong investor demand.
“There appears to be some investors in the market talking about the rising cost of capital coupled with banks lowering their loan to valuation ratios.
“Therefore the window for vendors to secure these record low yields may be closing. This means that the time is right to sell now in the back half of 2017,” Wright said.
Coorparoo was ranked in the top 10 locations in Brisbane for mixed-use development in Cushman & Wakefield’s recent Retail Outlook Report, due largely to its proximity to the CBD, population growth and transport access. This was also underpinned by increasing higher density development with construction activity steadily increasing.
“The significant levels of interest from high net worth individuals and the listed funds [reflects] the asset’s strong leasing covenants and longer term rental growth prospects coupled with the security provided by medical and allied health care tenants,” Cushman & Wakefield National Director Michael Collins said.
“With investment activity remaining strong coupled with decreasing stock levels, investors are starting to see value in high quality assets in highly sought after locations such as Coorparoo, particularly with exposure to the health care sector which is growing rapidly given our ageing population.
“National investment volumes remain buoyant, but Queensland continues to experience particularly high levels of investment activity in 2017.”
Queensland investment volumes in the last current quarter have continued at levels that saw Queensland top the state and territory rankings for investment volumes in the first quarter.
The $2.8 billion invested in the first half is up 33% compared to the first half of 2016, with unlisted funds remaining the most active purchasers, in a continuing trend over the last 12 to 18 months.
The Coorparoo Health Centre is adjacent to the several development projects in the area, including the $125 million soon to be completed Coorparoo Square development.