Big box update
Bunnings' ongoing store construction
Devonport Bunnings building from project management company, Willow Frank
Devonport Bunnings building from project management company, Willow Frank
 
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Bunnings rates highest on customer satisfaction and Woollies closes the chapter on Masters
HNN Sources
Bunnings stores continue to be built around Australia with more in the pipe line; proposed stores in Kingaroy (QLD) and Cootamundra (NSW) gain momentum; customers vote for Bunnings over Home Timber & Hardware; Bunnings Kawana has welcomed its first customers, providing competition to the nearby Kawana Hardware and Garden Centre; the site of the Bunnings Fyshwick (ACT) may have a different future; four newly-built Bunnings stores have been sold to property investors; and Woolworths has completed the sale of its shares in Masters' holding company.
Bricks and mortar builds for Bunnings

In the next few months and going into 2018, new Bunnings Warehouses will open in Devonport (TAS), Heatherbrae (NSW) and Rockhampton (QLD).
Devonport store

Bunnings general manager - property, Andrew Marks, told The Advocate the new Devonport store is expected to be open sometime in December. Construction work is almost complete at the site. He said:
Recruitment has been completed with more than 80 residents...Bunnings Devonport will cover more than 8,000sqm...The development represents an investment of over $19 million.

The Bunnings Devonport store is where the K&D Warehouse was located.
Bunnings in Port Stephens

The large, blue former Masters Home Improvement store at Heatherbrae (NSW) has begun turning green. The new Bunnings store will span more than 12,000sqm. Mr Marks said the new store was expected to open in time for Christmas.

According to real estate firm, Cushman & Wakefield, who sold the three NSW-based stores for Home Consortium - the purchaser of all 61 of the Masters sites across Australia as well as 21 development sites - the Heatherbrae Masters site sold for $12.3 million. The Heatherbrae sale included a total land holding of 45,730sqm, including two facilities: a 13,153sqm purpose built hardware retail warehouse and a 4,029sqm large format retail development with four retail tenancies.
Rockhampton opening date

Bunnings' new location at the former Masters Rockhampton site will be open to the public mid-2018. It received approval at the start of the year to move from its current location on Yaamba Road to the vacant Masters site.

This location, where Bunnings signage has recently been installed, will see the store nearby other stores such as Freddy's Fishing and Outdoors, Petstock and Autobarn. Mr Marks said:
We can confirm we have reached an agreement with the landlord to convert the former Masters Rockhampton site into a new Bunnings Warehouse. Conversion and reformatting works will occur in the coming months and the new store will span over 13,000sqm.

The Bunnings trade centre will remain in its current location.
Kingaroy, Cootamundra developments

Bunnings is a step closer to setting up shop in Kingaroy (QLD) after South Burnett Regional Council approved its development application at a recent meeting. The company will now move to square things with the state government before it breaks ground, according to the South Burnett Times.

Not surprisingly, Bunnings general manager - property, Andrew Marks welcomed the decision. He said:
We can confirm we have received development approval for a new Bunnings Warehouse in Kingaroy and will continue to work with the council throughout the planning process. The new warehouse will represent an investment of over $15 million...

In the lead-up to the vote, the council was petitioned by a group of concerned business owners who thought the development would spell doom for smaller traders. But in approving the application, planning portfolio councillor Terry Fleischfresser said a Bunnings store would complement the retail offerings in Kingaroy.

While the council is prohibited by Queensland law to consider commercial competition when approving development, Cr Fleischfresser said Bunnings would be good for the town. He said:
I've heard people say they are disappointed with us accepting a Bunnings application, however I can say every tradesperson in the South Burnett that I speak to keep asking me the same questions: are they coming and when are they going to be here?
The advantage of this business coming to town far outweighs the negatives.

https://www.southburnetttimes.com.au/news/bunnings-clears-hurdle/3266980/
Support for Cootamundra store

An extraordinary meeting of Cootamundra-Gundagai Regional Council was held to discuss a proposed Bunnings store. The location of this store is the corner of Wallendoon and Hovell Streets, opposite Thompson's Rural Supplies.

Council staff had recommended the proposed store be refused development consent, citing a number of shortcomings in the application put forward by Colin Blake. However councillors disagreed.

Absent from the meeting was Craig Stewart, who is employed by Cootamundra Mitre 10 and thus declared a non-pecuniary interest, and Leigh Bowden, who was in Sydney.

In a letter to the council, Cr Stewart declared he was in favour of new development and business in the Local Government Area.

Deputy mayor Dennis Palmer acknowledged that staff had prepared the instrument for refusal in accordance with adopted council policy and guidelines, however felt this could be varied in particular circumstances. He said:
We have been elected to look after the future of our towns and we must be proactive...

Cr Palmer said a newly developed side would be better than the current building. He also argued the car parking code could be altered subject to Traffic Committee approval. He added:
This council needs to be a 'can-do' facilitator, rather than a 'can't do' authority.

Doug Phillips held concerns the incomplete application may lead to legal ramifications for council and was the only councillor not to vote for Cr Palmer's motion. "I have no issue with the hardware store, I think it would be good competition for Mitre 10," he said, but stated the incomplete application should not have even been discussed by councillors.

Mayor Abb McAlister said that council must always be on the front foot when it comes to development before declaring his support for the hardware store.
Bunnings beats HTH on customer satisfaction

Bunnings has replaced Home Timber & Hardware (HTH) to be Australia's leading hardware store in September 2017, according to the latest rankings from Roy Morgan Research. It scored a customer satisfaction rating of 89.0%, up 0.1% from a year ago.

HTH came in second with a customer satisfaction rating of 88.6%, declining 0.4% points over the course of the year, but enough to beat out Mitre 10 in third with a customer satisfaction rating of 86.9%, down 3%.

Rounding out the hardware store "Big 4" is True Value Hardware with a customer satisfaction rating of 76.3%, down slightly on a year ago.

According to the Roy Morgan, approximately 13.1 million Australians visited a hardware store during the last three months. Michele Levine, CEO, Roy Morgan Research, said:
Bunnings is undoubtedly Australia's best known hardware store...Today's customer satisfaction results show Bunnings' impressive reputation is built on a high rate of customer satisfaction - now at a market leading 89% in September...
HTH has performed consistently well over the past few years winning the annual Roy Morgan Hardware Store Customer Satisfaction Award in four out of the last five years (2012, 2013, 2015 and 2016) although the 2017 Annual Award looks set to go down to the wire with Bunnings aiming for its first victory in the category since 2011.
Bunnings Kawana open to customers

Store manager Emily Sweet of the new Bunnings store on Kawana Way in Warana (QLD) said the team has been excited to welcome the local community to the store and celebrate with them at the grand opening event.

However Kawana Hardware and Garden Centre owner Ian Witten expects his business will take a hit with the launch of the Bunnings outlet.

Mr Witten moved to the Sunshine Coast from western New South Wales in 1998 to take over the store. One of his sons had bad asthma so he gave up farming for an entirely different career where harsh winter weather was not a problem.

In the two decades since then, he has seen a number of independent hardware stores close down in the Kawana Waters, Buderim, Caloundra and Maroochydore areas. His enterprise has survived but he expected sales would be affected by a new competitor. He told the Sunshine Coast Daily:
When Caloundra (Bunnings) opened, we really felt it and that lasted six to eight months, then it went back to normal. I think we will see a fall in sales through the Christmas period.

He said Bunnings had excellent marketing.
I don't know how we compete with it.

He said a focus on customer service and providing products outside of the Bunnings range were among his tactics.
We try and stock what they don't.

Mr Witten said he was getting some benefit from the commercial and residential expansion at Birtinya and Bokarina.
We supply the bricklayers and landscapers but a lot of it is corporate purchases. When people need maintenance on their houses later on, that is where we come along.
Bunnings Fyshwick may become train station

News that Bunnings could take up the former Masters site at Majura Park (ACT) may be the first move that could see the relocation of Canberra Railway Station to Fyshwick.

Bunnings staff at the Fyshwick store on Newcastle Street have been aware all year that they would be transferring to Majura Park in 2018. One staff member told the Riot Act the ACT Government and Bunnings had been in negotiations for some time with the aim of the Government acquiring the site to develop a new railway station.

Bunnings said in a statement that a final decision had not been made on the future of the Fyshwick site, but it was likely that it would continue to trade "in one form or another". Acting state operations manager, Robyn Hudson, said in a statement:
Team members will either relocate to the new Canberra Airport site or remain at the current Fyshwick store. We will continue to ensure our team members and the community are kept up to date with any progress on our plans.

But Bunnings did not respond to questions about whether it had been involved in any negotiations with the ACT Government.

Land between the rail line and Bunnings is vacant and being used as a makeshift car park. Combined with the Bunnings site, it could allow for a rail and bus interchange, car park and integrated mixed use development, as recommended in 2009 by the Railway Master Plan for the ACT.
Bunnings' latest stores remain outside metro areas

In recent months, Bunnings has officially opened stores in Windsor Gardens (SA), Toowoomba North (QLD), Bellambi (NSW), Bonnyrigg (NSW) and Dalby (QLD).
Windsor Gardens

The new Bunnings $47 million outlet at Windsor Gardens will be one of the largest in South Australia. Complex manager Simon Ahladas heads the team at the new store at 432 North East Road and spread over 13,000sqm. He said:
We have been a part of the local community for over 15 years.

It's the second Bunnings store in the northeast, with another established at Modbury.
Toowoomba North

Australian rugby league great Shane Webcke helped to launch the Toowoomba North Bunnings store on the site of the old foundry. The opening marks the 42nd Bunnings store to open in Queensland and the 260th warehouse to open around Australia, New Zealand and the UK.

Toowoomba's second Bunnings Warehouse is one-and-a-half times the size of the first at 18,000sqm. The big box retailer said the project represents more than $50 million worth of investment, and is expected to inject $4.7 million worth of wages from 170 jobs into the local economy in the first year of operation.
Bellambi

Former Australian international cricketer, Brett Lee officially opened the new Bunnings Bellambi Warehouse. The store presented an opportunity for a career change for team member Bianka Hoswell who grew up in Bellambi and worked as a nurse in aged care for eight years.

But she is now working in a supervisory role in the leisure and landscape section of the store. She told the Illawarra Mercury:
Their approach is beautiful. They have this whole family feel about the business. There is plenty of innovation and team development so Bunnings was very appealing to me.

And she hopes her story about changing careers will encourage others. She said:
I'm really happy to have a second family here with the team that I am working with. I am incredibly grateful.
Bonnyrigg

The new Bonnyrigg store replaces the previous warehouse located next door and was opened by Parramatta Eels rugby league legend Peter Sterling. He was joined by Bunnings Group CEO Michael Schneider, complex manager Andrew Shalala and staff.

The new Bunnings has an approximate total store size of 15,000sqm.
Dalby

Bunnings Dalby store manager, Jodie Ianna, is joined by over 25 Dalby locals who are now official team members of the new $12 million, smaller-format store. Ms Ianna has worked at Bunnings for 12 years. She told The Chronicle:
Team members have supported a number of community groups already, working with Goodstart Early Learning Centre to extend the centre's outdoor environment with a sensory garden, as well as helping to revamp the Dalby Diehards Football Club's 100-year-old grandstand.

Bunnings Dalby is located at the corner of the Warrego Highway and Eton Street in Dalby (QLD).
Four more warehouse stores sold

A portfolio of four newly-built Bunnings hardware stores have been sold to CBRE Global Investors in a transaction worth $180 million with yields in the five per cent range.

The hardware chain has offloaded stores in Windsor Gardens (SA), the Auckland suburb of New Lynn in New Zealand and the Sydney suburbs of Caringbah and Bonnyrigg. All four sold with 12-year leases in place to Bunnings.

CBRE Global Investors said that all four freehold assets are located in metropolitan areas on arterial roads. Factors expected to drive growth in these markets include household disposable income, renovation activity, housing churn, value and formation, weather, lifestyle and demographic trends, government activity and technology.

Bunnings' general manager - property, Andrew Marks said the sale was consistent with the group's long-term strategy of diversifying its investor base and recycling capital on lease terms that provide it operational flexibility. He told Fairfax Media:
We are pleased to have completed another successful sale at a yield that is reflective of the market and on lease terms that take into account our operational objectives.

CBRE Global Investors director Chris Johnston said the group intended to work with Bunnings on future transactions for similar assets. He said:
This portfolio provides exposure to a strong credit tenant who is a leading retailer in the home improvement market with quality assets and attractive lease terms.
Woolworths makes final exit from Masters

Woolworths has finally extricated itself from its failed Masters hardware venture by completing the sale of its store sites.

The supermarket giant said it has completed the sale of Hydrox - the joint venture company it set up with US firm Lowe's to run Masters - to the privately owned Home Investment Consortium for a headline sale price of $525 million.

Home Consortium plans to convert the Masters stores into large format retail centres featuring outlets including Spotlight, Anaconda, Chemist Warehouse, JB Hi-Fi and The Good Guys.

Lowe's handed over its 33.3% stake in Hydrox to Woolworths in August, in line with federal court proceedings, allowing the local retail giant to make the final step in selling the former Masters stores.

Woolworths previously said the capital losses associated with the sale of Hydrox were about $1.8 billion.

The sale to Home Consortium includes 40 Masters freehold trading sites, 21 Masters freehold development sites and 21 Masters leasehold sites.
HNN Sources


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