Investor splashes $43 million on Rockhampton property
REAL estate fund manager MPG has snapped up a $43.5 million slice of prime Rockhampton property, buying the Bunnings complex from Charter Hall.
The 18,319 sq m site also includes the speciality tenancies Autobarn, Petstock, Freddy’s Fishing and Outdoors and 1060 sq m of vacant space supported by a three year rental guarantee. The Bunnings Warehouse itself is 13,242 sq m.
MPG chairman Trevor Gorman said the MPG Bunnings Warehouse Rockhampton Trust closed two times oversubscribed.
“With the Australian sharemarket at record highs and with RBA cash rates at historical lows, the income characteristics of property with cash returns in the vicinity of 6 to 8 per cent are looking very attractive to investors compared to most cash and fixed interest investments,” Mr Gorman wrote in a letter to investors.
MPG will also launch a Regional Cities Property Trust this year that will soon hold $100 million in investments.
MPG’s regional focused portfolio now extends to more than $700 million of properties, after acquiring 14 properties in the past 18 months.
The Bunnings property is 94 per cent leased with an 8.5-year weighted average lease expiry. It is expected to meet its 6.5 per cent distribution yield for the 2020 financial year.
The site was originally tenanted by Masters, which closed its doors for the last time in December 2016 following a closure across the company nationwide.
The site sold in 2009 for $11.2 million and again in 2017 for $37.5 million.