Invest at your convenience
Most of the properties are on main roads and are operating petrol stations which offer high yields in a low-interest-rate environment.
Sales agents say auction rooms are always busy when this style of asset is offered.
The latest sale was a 7-Eleven at Revesby last Tuesday. It attracted bidding competition from a range of high-net-worth private investors and syndicates.
Acting for the 7-Eleven parent body, Jones Lang LaSalle's director of sales and investments for South Sydney, Michael Ajaka, sold the property to a private investor for $2.74 million, which was a net return of about 5.4 per cent after land tax.
Mr Ajaka said there was strong bidding for the property from four buyers at the auction.
"Service stations continue to be a blue-chip asset class, with long-term secure leases, solid returns and great appeal for private investors, with all outgoings paid by the tenant except land tax," Mr Ajaka said.
"We have received high clearance rates at all 7-Eleven auctions."
Over the past two years, Jones Lang LaSalle has sold, nationally, $215 million worth of 7-Eleven service stations and properties on behalf of the parent company. They were sold as lease-back investments.
Revesby 7-Eleven, at 295 Canterbury Road, is leased for a minimum of 15 years with three five-year options. It features strong lease covenants and is well-positioned in metropolitan Sydney.
The sale of the Revesby 7-Eleven concluded auctions for three 7-Eleven properties in May. Others to sell were: 439 Princes Highway, Carlton, which sold for $2.75 million for a 5.3 per cent net return after land tax; and, 35 Parramatta Road, Haberfield, which sold for $2.6 million with a net return of 4.3 per cent after land tax.
Mr Ajaka said low interest rates for lenders had created additional interest among bidders.
Investors say the attraction is not just the higher yields, but the looming prospect that some of the 24-hour properties will be used as delivery sites and collection points for internet purchases.
The flaw in buying online remains collection of the items, which is getting harder. Some banks and city centre businesses have banned staff from having personal purchases delivered, for security issues, and also because it clogs the mail room.
That has led to buyers returning to local post offices or relying on neighbours and friends to be at home to sign for delivered items.
In the US, internet giants Amazon and eBay are leasing traditional bricks-and-mortar stores as collection outlets. Amazon has also trialled lockers within 7-Eleven convenience stores for 24-hour collections for its customers.
Australia Post has announced plans to roll out its version of lockers that can be accessed at any time with a swipe card or a PIN code sent by an SMS message. The Australian Service Station Association said it would talk to its members about using their sites for the collection of goods bought online.
Frequently Asked Questions about this Article…
Private investors are attracted to 7‑Eleven and other street‑side petrol stations because they offer high yields, long‑term secure leases, and tenants typically pay all outgoings except land tax. Auctions for these assets are busy and draw strong bidding, making them a sought‑after investment class for everyday investors seeking steady income.
Nearly $250 million worth of 7‑Eleven and similar properties have sold in the past two years. Recent examples include Revesby selling for $2.74 million (about a 5.4% net return after land tax), Carlton (439 Princes Highway) for $2.75 million (5.3% net after land tax) and Haberfield (35 Parramatta Road) for $2.6 million (4.3% net after land tax).
A lease‑back investment is when the property owner sells the asset but the original operator (in this case 7‑Eleven) remains as tenant under a long‑term lease. Jones Lang LaSalle sold many 7‑Eleven sites nationally as lease‑back investments, providing buyers with established tenants and predictable rental income.
Some 7‑Eleven sites feature long minimum lease terms and multiple renewal options. For example, the Revesby store is leased for a minimum of 15 years with three five‑year options, giving investors long‑dated income and strong lease covenants.
Auction rooms are described as always busy when street‑side service station assets are offered. The Revesby sale attracted four competing bidders at auction, and agents report high clearance rates across 7‑Eleven auctions, indicating strong buyer demand and competitive bidding.
Low interest rates for lenders have increased investor interest by making financing more affordable. According to sales agents, the low rate environment has helped drive additional bidder competition for service station assets seeking higher yields.
Investors see upside in 24‑hour properties because they can be repurposed as delivery and collection points for online shopping, solving the problem of secure, out‑of‑hours collection. In the US, Amazon and eBay have leased bricks‑and‑mortar stores, and Amazon trialled lockers inside 7‑Eleven stores. Australia Post is also rolling out 24‑hour lockers that use swipe cards or PINs sent by SMS.
While tenants usually pay operating outgoings, owners remain responsible for land tax, which reduces net returns. On the consumer side, secure parcel collection is an ongoing issue—some workplaces ban personal deliveries, pushing customers back to post offices or neighbour assistance—creating an opportunity (and practical consideration) for 24‑hour retail sites to host lockers or collection services.
Call 1300 880 160
Start a chat
Schedule a call
