Cheers! Dan Murphy’s a dream tenant for landlord investors

The campaign generated more than 400 enquiries and 15 bids from a range of private investors and developers, including several sourcing money offshore, the agents said.

Loading

Retail transactions this year are subdued in Victoria. Stock levels and transaction volumes are down across the board after record volumes seen last year.

“There has only been few major retail assets transact this year, with neighbourhood and subregional centre transactions being extremely quiet. There is no doubt that vendor confidence at the top end has waned,” Taylor said.

Only around $676 million worth of retail property has sold in the year to date, a sharp 65 per cent drop on $1.96 billion sold by this point in 2021.

Noonan said private investors, who commonly can stump up large sums of equity to fund their purchases, are not as affected by steep rises in interest rates and are still bidding competitively for premium assets compared to other investors who are reliant on debt.

Loading

“It’s somewhat of a two speed market I guess,” Noonan said.

Dan Murphy’s has about 250 stores nationally. Its outlets often hold a virtual monopoly in the area where they are located meaning the group rarely needs to relocate stores.

That geographical longevity is prized by landlords and investors alike and creates a Dan Murphy’s ‘premium’ over other retail investments.

Dan Murphy’s owner, the $13 billion ASX-listed Endeavour Group, said on Monday it generated $2.49 billion sales in its stores during the September quarter, down 6.2 per cent on the previous corresponding period.

“Our year-on-year comparison shows a predictable decline as we cycle the unique spikes in demand created by COVID-19 restrictions that particularly affected key population centres of New South Wales and Victoria this time last year,” chief executive Steve Donohue said.

The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning.