Sales Leasing Management Advisory Woolworths/Caltex Bendigo (Kennington) VIC 123-125 Condon Street Information Memorandum Auction 11am AEDT Wednesday 24 October 2018 River Room, Crown Casino, Melbourne
Table of Contents Introduction 4 Investment Features 6 Location 10 Location Maps 11 Property Details 12 Lease Details 13 Financial Summary 13 Tenant Profile 14 Method of Sale 16 Interstate Bidding 16 Contact 16 Property Management 17 Disclaimer 18 Appendices Appendix 1: Title Plan Available Upon Request Lease Documentation Sale Documentation Environmental Reports 2 Information Memorandum 123-125 Condon Street, Bendigo (Kennington) Burgess Rawson 3
Introduction Burgess Rawson and Tweed Sutherland First National are delighted to offer the Woolworths Petrol & Fusion Physiotherapy located at 123-125 Condon Street, Bendigo (Kennington) Victoria, for sale by way of Auction to be held from 11.00am (AEDT), Wednesday 24 October 2018, in the River Room, Crown Casino, Southbank Melbourne. Burgess Rawson Since being established in 1975, our Sales, Leasing, Property Management, Valuation and Advisory services fulfil the complete and ongoing needs of our clients. Burgess Rawson has a network of offices throughout Australia and extensive regional partnerships with local property specialists, giving unmatched depth and reach in all commercial property market sectors. At every stage of ownership, our clients benefit from our specialist knowledge, experience, market insights and advice. Our strong market position, plus our targeted and effective marketing campaigns through a highly qualified database, generates maximum exposure for properties. Burgess Rawson s iconic Portfolio Auctions are held in Melbourne and Sydney bringing together a diverse range of national commercial and investment grade properties. Our renowned auction program, together with a large pool of qualified investors continues to generate results. With eight, two day Investment Portfolio Auction events held each year, Burgess Rawson are the leaders in the selling of quality property investments. Based on our knowledge and experience, Burgess Rawson and Tweed Sutherland First National are confident in recommending the property as an outstanding investment opportunity. 4 Information Memorandum 123-125 Condon Street, Bendigo (Kennington) Burgess Rawson 5
Investment Features New 10 year lease to Woolworths Ltd to 2026 plus options to 2046 Woolworths Petrol: a division of Woolworths Group Limited with a network of over 600 outlets and FY18 revenue of $4.7 billion Re-tanked and refurbished at lease commencement and new strategic partnership with Caltex Limited Includes brand new 4 + 4 + 4 year lease to established physiotherapist with multiple locations in Bendigo T/A Fusion Physiotherapy Highly strategic Commercial 1 land parcel of 5,068 sqm with 40m frontage to Condon St & access to Edwards St amongst two major shopping centres servicing the growing residential population of eastern Bendigo Tenants pay all usual outgoings as per the lease/annual rent reviews Greater Bendigo: Victoria s third largest urban centre with a growing population of over 113,000 forecast to increase to 145,000 to 2031 Location 123-125 Condon Street, Bendigo (Kennington) VIC Site Area 5,068 sqm (approx.) Building Area Woolworths Building 270 sqm Fushion Physiotherapy Building 500 sqm Lease Details Woolworths Term: Ten (10) year lease to 2026 Options: Four (4) further Five (5) year option 2046 Rental: $241,740 pa (est. 2.5% review Feb 19) Fusion Physiotherapy Term: Four (4) year lease to 2023 Options: Two (2) further Four (4) year option 2030 Rental: $54,500.04 Method of Sale For sale by Auction on Wednesday 24 October 2018 at 11am (AEDT) River Room, Crown Casino, Melbourne Jamie Perlinger 0413 860 315 Tom Harrop 0409 014 657 Scott Meighan 0413 830 709 6 Information Memorandum 123-125 Condon Street, Bendigo (Kennington) Boundaries are indicative only Burgess Rawson 7
A recently refurbished and re-tanked service station with a new 10 year lease to Woolworths, supported by an established local physiotherapist and underpinned by a valuable Commercial 1 landholding totalling 5,068 sqm Jamie Perlinger 8 Information Memorandum 123-125 Condon Street, Bendigo (Kennington) Burgess Rawson 9
Location Bendigo is Victoria s largest regional city and situated in the geographic heart of Victoria: This City is located approximately 150km north west of Melbourne s CBD, at the junction of four highways (with excellent connections to interstate highways) and only a 90 minute drive from Tullamarine Airport. The steadily growing population of the City currently sits at approximately 116,000 and is forecast to further grow to just under 200,000 by 2050. (www.id.com.au). The City of Greater Bendigo is located in the centre of Victoria, covering almost 3,000 square kilometres. Greater Bendigo is a vibrant, creative and culturally enriched major regional centre for northern Victoria and sourthern NSW and has the third largest urban area in Victoria. It also includes productive agricultural areas and many small towns and villages such as Heathcote, Axedale, Huntly, Marong, Elmore, Goornong, Kamarooka, Lockwood, Neilborough, Sebastian, Woodvale, Raywood, Mia Mia and Redesdale, which are renowned for their strong sense of community and lifestyle. The local population is continuing to grow and is increasingly culturally, religiously and ethnicially diverse. Council is committed to Greater Bendigo being a community that understands and respects cultural and religious differences, supports multiculturalism and actively promotes cultural inclusion. The trade area directly served by the City is a massive 200,000 people, and includes the thriving smaller communities of Heathcote, Elmore, Goornong, Marong, Redesdale and Axedale. The area has a prosperous history, commencing with the discovery of gold in 1851. By the 1880 s Bendigo was proclaimed the richest goldfield in the world, with tens of thousands people flocking there to seek their fortune. Approximately $9 billion worth of gold has been discovered in Bendigo, making it the second highest producing goldfield in Australia and the seventh richest in the world. Bendigo is now a thriving and established regional city with an overall gross economic output of over $10 billion per annum. Some of the largest employers in the Greater Bendigo region include: Bendigo & Adelaide Bank Head Office - $100million six storey building Thales Australia LaTrobe University Australian Defence Apparel Bendigo TAFE Bendigo Victoria s largest inland city expected to grow to 150,000 people by 2036 For further information, please visit: www.bendigo.vic.gov.au Brief Statics Bendigo Estimated Population 2018: 116,568 Forecast Population 2038: 155,596 Forecast percentage change between 2017 and 2050 33.48% 10 Information Memorandum 123-125 Condon Street, Bendigo (Kennington) Burgess Rawson 11
Property Details Lease Details Address 123-125 Condon Street Bendigo (Kennington) VIC Title Details Volume 10028 Folio 266 Lot 7 on Plan of Subdivision 30627R Zoning Commercial 1 Zoning under the Greater Bendigo Planning Scheme Lessee: Lease Details Woolworths Limited Lease Commences: Ten (10) years from 3 June 2016 Lease Expiry: 2 June 2026 Options: Four (4) further options of Five (5) years to 2 June 2046 Rent Reviews: Outgoings: Rental: Annual CPI reviews with a market review at the commencement of further option period The Lessor is responsible for all usual outgoings as per the lease, excluding single holding Land Tax. $214,662 pa Lessee: Fusion Physiotherapy Location This recently refurbished service station featuring 2 street entrance-exits points is located 2.7klm from Bendigo s CBD and is extremely well positioned in an exceptionally strong residential and commercial precinct. It is also strategically positioned at the midway point between the CBD and the rapidly expanding high growth Strathfieldsaye area. It occupies a high visibility site and has a phenomenal flow of passing traffic at all times of the day and weekends. Adjacent is the Freedom Aged Care facility, ALDI supermarket and large variety of specialty shops including the Bendigo Bank. Across the road is the large thriving Strath Village Shopping Complex which was recently re-developed into a very significant centre comprising several multi-national companies including Woolworths, IGA, KFC, McDonalds, Subway, Commonwealth and National Banks along with a multitude of specialty business s such as bakers, grocers, clothing stores and cafes amongst others. The large and expanding La Trobe university is approximately 700 yards away and there is a relatively short drive of 1.8klm to the McIvor Highway, the main eastern entrance point into Bendigo from Heathcote, Kilmore and Melbourne. Site Area The site is irregular in shape, a total of 5,068 sqm with the following boundary dimensions: Northern Boundary Southern Boundary (incl. 40.58 m to Condon St) Eastern Boundary (incl. 9 m to Edwards Rd) Western Boundary 110.51 m 95.58 m 88.80 m 95.32 m Building Description The property comprises a recently refurbished Woolworths convenience store to the tenants current corporate standards and design, an attached canopy with 4 metre clearance height and covering four pump islands. In addition, Fusion Physiotherapy lease the two buildings to the rear of the site, with the building to the rear of site used predominately for the tenants core business of physiotherapy and allied health services with the smaller brick building used for storage with the total site area noted on the Disclosure Statement as 1,000 sqm with the buildings totalling 500 sqm. Lease Commences: Four (4) years from 2 January 2019 Lease Expiry: 1 January 2023 Options: Two (2) further Four (4) year options to 2031 Rent Reviews: Outgoings: Rental: Annual CPI reviews with a market review at the commencement of further option period The tenant is responsible for all usual outgoings as per the lease, excluding single holding Land Tax. $54,500 pa Financial Summary Income Rent $269,152 pa Less Non-Recoverable Outgoings Council Rates $13,862 pa Water Rates $912 pa Building Insurance $3,700 pa Single Holding Land Tax $2,304 pa Total $20,778 pa Estimated Net Rent $248,384 pa Please note that the above information is intended as a summary of the lease agreement supplied and has been represented as accurately as possible. We recommend prospective purchasers make their own enquiries to gain a thorough understanding of the provisions of the lease contained within in the Sale Contract. 12 Information Memorandum 123-125 Condon Street, Bendigo (Kennington) Burgess Rawson 13
Tenant Profile Woolworths is one of the largest companies by market capitalisation on the Australian Stock Exchange, it is Australia s largest retailer and is widely regarded as a blue chip tenant. The full year ended 30 June 2018 is indicated by the following: Woolworths with over 3,100 stores in Australia and New Zealand of which 961 are operated by the supermarket division. The liquor division of approximately 1,500+ locations of BWS outlets plus Dan Murphy s stores. Woolworths/Caltex alliance petrol sales for the year were $4.8 billion, for the network of over 600 petrol sites across the country. For the 12 months to 30 June 2018 Woolworths sales totalled $55.5 billion, and delivered $548 million net profit before tax. A public company, Woolworths employs over 200,000 people and has approximately 445,000 shareholders. Market capitalisation is approximately $36.59 billion (October 2018) Established over 90 years ago, Woolworths is one of Australia s most successful companies and one of the largest private sector employers in Australia. Source: www.woolworthsgroup.com.au Caltex Partnership On the 5th of July this Year Caltex Australia and Woolworths announced an extension and expansion of their strategic partnetship to include the co-creation of a market-leading convenience offering as well as long term wholesale grocery supply, loyalty and redemption arrangements with Key Points as follows; Caltex and Woolworths have entered into a new 15 year fuel supply agreement. Caltex and Woolworths have agreed to co-create a market-leading convenience retail offering, across approximately 250 Caltex retail sites. The sites will be co-branded with for the convenience retail offering. Caltex and Woolworths have also entered into commercial arrangements covering wholesale grocery product supply, redemption and Caltex s participation in the Woolworths Rewards program that will further enhance Caltex s convenience offering. Partnership represents a significant milestone in the transformation of Caltex, building on our prior efforts on Convenience Retail, and will both accelerate and strengthen our Freedom of Convenience Strategy. The fuel supply agreements and commercial arrangements are not subject to any conditions precedent or regulatory approvals. Steps taken to replace the earnings expected to be lost, had Woolworths sold its fuel business, will now enable Caltex to deliver earnings growth given retention of fuel supply agreement and other commercial arrangements announced today. For more information https://www.caltex.com.au/our-company/media-releases/caltex-and-woolworths-extend-andexpand-long-term-partnership 14 Information Memorandum 123-125 Condon Street, Bendigo (Kennington) Burgess Rawson 15
Sale Process Property Management Method of Sale For sale by auction on Wednesday 24 October 2018 at 11:00am (AEDT) River Room, Crown Casino, Melbourne, VIC Flinders St Railway Melbourne Exhibition Centre Clarendon St Normanby Rd Whiteman St Yarra River Food Court Casino Whiteman St Crown Metropol Interstate & Local Bidding Interstate and local bidding available at Burgess Rawson offices. Inspections Inspections can be arranged by prior appointment. King St P Casino Palladium P River Room Terms of Sale Deposit of 10% payable upon exchange and the balance upon settlement. It is proposed the property will be offered as a going concern and if the purchaser meets the provisions of the GST legislation the sale will not incur GST P Multi-level Car Park Yarra Promenade Escalators Kings Way Crown Towers Main Complex Entry Atrium Crown Conference Centre Power St Crown Promenade City Rd Queensbridge St With an Australia-wide management portfolio of well in excess of $2billion, we are able to equally manage property whether it is CBD, metropolitan or regionally located. More than Rental Collection - care for your property and investment. Professional property management enhances and secures your tenant relationship, provides property accounting (including tax invoicing/ GST/BAS) reports and maximises rental. We take the weight off your shoulders. Achieve $ savings - through our buying power and access to the best providers: insurance brokers, maintenance contractors etc. We have the contacts and long standing relationships to be at your disposal. Improve your cash flow - Apart from ensuring regular rental increases are enacted to maximum sustainable levels, a professional property manager reviews council rating values, as well as accessing the best taxation depreciation assessment to improve your after income tax bottom line. We aim to add more to your overall capital value. Not missing a beat - With our daily contact in the market, we hear about new developments, tenants on the move etc. Whether this information helps protect your investment or leads to further opportunities, we have our ears to the ground. Problem solvers - Owning property has never been more complicated, and highly regulated. We are fully conversant with the Retail Tenancies Act, Town Planning and Occupational Health and Safety Regulations. We can anticipate and prevent problems. Experience and involvement - Our professional property managers offer a wide range of expertise. Time in the profession, and continuous improvement and involvement in the property sector is an intellectual pursuit. We can provide a pool of such experience to individual clients in a way we believe self-managed property owners cannot. Value for money - free yourself up to concentrate on the returns of your investments, rather than the daily issues which can arise from your property. The small cost involved in professional management is money well spent. We have the resources to service your needs. To discuss your particular property management s needs, please contact either Leon Holderhead or Phil Harrison today. Leon Holderhead Asset Manager 0413 830 304 lholderhead@burgessrawson.com.au Phil Harrison Asset Manager 0413 860 303 pharrison@burgessrawson.com.au Burgess Rawson & Associates First National Commercial Level 7, 140 Bourke Street 2 Mitchell Street Melbourne Bendigo VIC 3550 Jamie Perlinger Tom Harrop 0413 860 865 0409 014 657 jperlinger@burgessrawson.com.au Scott Meighan 0413 830 709 smeighan@burgessrawson.com.au tom@tsfn.com.au 16 Information Memorandum 123-125 Condon Street, Bendigo (Kennington) Burgess Rawson 17
Disclaimer Appendix 1: Title Plan The information contained in the report/information memorandum has been prepared in good faith and due care by the Vendor, Burgess Rawson and Tweed Sutherland First National. Any projections contained in the report therefore, represent best estimates only and may be based on assumptions. The information contained herein is supplied without any representation as to its truth or accuracy. All interested parties should make their own enquiries to satisfy themselves in all aspects and obtain their own independent advice in order to verify any of the information. All stated dimensions and areas are approximate. The vendor does not represent or warrant the accuracy of any information contained in this document. Subject to any statutory limitation on its ability to do so, the vendor disclaims all liability under any cause of action, including negligence, for any loss arising from reliance on this document. Specifically, we make the following disclosures: All areas, measurements, boundaries, car space numbers, rents are approximate only and subject to final confirmation; The indicative depreciation schedule has been provided by Napier & Blakeley and is an estimate only and cannot be used for tax purposes. The information contained in this document is provided as a guide and an aid to further investigation by potential purchasers. Prospective purchasers should seek legal, financial and other appropriate expert advice in order the verify the accuracy of the information presented in this document Intellectual Property The information contained in the report has beenprepared in good faith and due care by Burgess Rawson. The contents of this document are proprietary to Burgess Rawson this includes: research including transactional data and reproduction of this information by any other part is not authorised. All other information contained herein is from noted sources deemed reliable, however Burgess Rawson does not represent or warrant the accuracy of any information contained in this document. GST Disclaimer Burgess Rawson and Tweed Sutherland First National and advises that the financial information in this report relating to income, outgoings and the like is provided without reference to the possible impact of GST, if any. Purchasers should make their own assessment of the impact of GST on the investments and the returns derived there from after obtaining expert professional advice. Retail Leases Act 2003 Tenant outgoings Prospective buyers should note that the recovery of outgoings from a tenant is subject to the application of and proper compliance with the Retail Leases Act 2003 (Vic). The Act applies to leases of retail premises in Victoria. If the Act applies, certain outgoings, such as land tax and some maintenance costs, cannot be recovered from the tenant. If the Act applies, other outgoings, such as management fees, can only be recovered from the tenant if the Act has been complied with. 18 Information Memorandum 123-125 Condon Street, Bendigo (Kennington) Burgess Rawson
Appendix 1: Title Plan Information Memorandum 123-125 Condon Street, Bendigo (Kennington)