WHEN 35 commercial properties went under the hammer at a three-day auction extravaganza, 22 of them in the Yallamundi Rooms at the Sydney Opera House this week, one of the stars of the show was Wonthaggi’s prominently-located Kentucky Fried Chicken store.
While prices of $3.5 million to $4.5 million were common, Wonthaggi’s KFC was right up there in terms of yield, returning 3.92% to the new investors, at a knock-down price of $3,205,000.
Representing the selling agents Burgess Rawson of Lonsdale Street Melbourne, Raoul Holderhead, formerly of Leongatha, said it was a significant result for Wonthaggi and South Gippsland generally.
“We all know how much Wonthaggi has grown in recent years, but this is the high-water mark in terms of commercial interest in the town,” Mr Holderhead said this week.
“Amongst 34 other properties being sold Australia wide, the Wonthaggi result is right up there,” he said, noting that it was a very strong endorsement for the area, alongside properties sold elsewhere by Burgess Rawson in Bass Coast and South Gippsland in recent times.
Beau Coulter, also reepresenting the selling agents Burgess Rawson in this round of investment portfolio auctions, said that after three days of sales, on May 14 in Melbourne when 15 properties went up for sale, on May 15 in Sydney (22 including KFC Wonthaggi) and May 16, eight in Brisbane; 31 properties were sold at a clearance rate of 91%, grossing $87.1 million.
“In total we had 600 individual bids, and 181 registered to bid over the three days with a blended yield of 5.53%,” Mr Coulter said indicating just how good the Wonthaggi result was by comparison.
Other Victorian sales included the DF Fitness Centre in Leongatha for $596,000 at an attractive yield of 4.71%, Duncan’s Dingley cellars for $1.1 million (yield 5.33%) and Jaycar Traralgon for $1.32M (5.84% yield).
Several properties were sold for $7 million-plus with properties listed in Qld, NSW, Vic, Tas and SA.
Burgess Rawson listed the following highlights for KFC, at 44-48 Graham Street (Bass Highway), Wonthaggi:
This investment has the following key highlights:
+ Renewed 10 + 10 + 10 year ground lease from August 2024 through to December 2054.
+ Proven KFC restaurant with tenant on-site 19+ years.
+ Southern Restaurants: Australia’s largest private KFC franchise group with 6,000+ employees across 94 locations in VIC, NSW & ACT. (1)
+ Highly sought after ground lease structure – tenant responsible for all capital and structural repairs and maintenance.
+ Investor preferred net lease terms with tenant paying all usual outgoings including building insurance.
+ Fixed 3% annual rent increases assuring income growth.
+ Impressive KFC restaurant with major 2024 store refurbishment planned.
+ Strategic 2,330sqm* ‘corner island site’ with 193m* quadruple frontage and important 20 on-title car spaces.
+ Site includes 663sqm* of surplus land providing immediate development upside (STCA).
+ High profile Bass Highway corner landholding with exposure to 18,995+ vehicles passing daily. (2)
+ Potential 50% stamp duty saving.
+ Wonthaggi: capital township of Bass Coast shire, with a trade catchment of circa 20,000 (plus season holiday influx).
+ Net Income: $125,620pa* + GST (as at 5 August 2024).
See full auction details here.
