Published on 17 November 2023
Fast food remains one of the most resilient sectors in the property market with the sale of a KFC in Townsville attracting strong interest despite concerns about the economy.
Stonebridge Property Group’s Tom Moreland said fast-food assets figured prominently in the agency’s $21m sale of five Queensland properties and $120m of freestanding assets across Australia with yields as low as 2.64 percent.
A Melbourne-based investor paid $4.2m for the newly built KFC at 31 D’Arcy Drive, at Fairfield in Townsville.
The asset attracted 190 inquiries and six offers, with potential buyers attracted by the new 10-year lease to ASX Listed Collins Foods until 2033, plus options to 2053.
The sale realised a yield of 4.52 percent.
Mr Moreland said that there was a real hunger for fast-food assets, despite 13 interest rate rises.
“Fast food remains the most resilient commercial property asset class, with our data indicating yields have moved less than 25 basis points in the last two years on a national basis,” Mr Moreland said.
“The tightly held nature of the sector has kept the market very buoyant with this being only the third KFC sold in Queensland this year, exemplifying the rare nature of the offerings,” he said.
The other Queensland sales by Mr Moreland, Michael Collins, Thomas Proberts and James Freemantle were:
– Oporto, 29A Takalvan St, Bundaberg, $3.8m (4.63 percent yield);
– Fast Food and Retail Centre, 10-22 Perseverance Way, Logan Village, $4.05m (5.65 percent);
– Bridgestone, 13 Hooper St, West Ipswich, for $2,405m (5.01 percent)
– Yokohama Tyres & More, 473 Stafford Rd, Stafford, $4.29m (5.16 percent) and;
– Autopro, 20 Albion St, Warwick, $2.01m (6.01 percent).
Mr Moreland said that despite economic headwinds, private investors were maintaining a pursuit of quality commercial holdings.
The Queensland sales were underpinned by household name covenants such as KFC, Bridgestone and Oporto.
“Many of these buyers are undeterred by regional locations such as Townsville, which possess a resilient economy and strong retail trade fundamentals,” he said.
The Courier Mail, Chris Herde
