Wesfarmers is set to offload a portfolio of six Bunnings warehouse sites across Australia in a deal estimated to fetch around A$300 million as the conglomerate capitalises on soaring demand for prime retail real estate.

The off-market transaction, managed by CBRE, includes Bunnings stores in NSW (Alexandria, Mittagong, Goulburn), Queensland (Airlie Beach, Oxenford), and Victoria (Thomastown).

Combined, the assets cover roughly 85,000 square metres of lettable area and generate an annual income of A$14.9 million.

Structured under BPI No 1 Pty Ltd, the portfolio forms part of Wesfarmers’ broader plan to unwind the BPI property structure by September 2025.

The move follows the company’s March announcement to explore capital management options, with a potential pre-tax gain of up to A$130 million expected in FY25.

The sale is being framed as a leaseback arrangement, providing investors with long-term income backed by CPI-linked rent reviews and initial lease terms of 10 years, with options extending to 58 years.

Wesfarmers says the divestment aligns with Bunnings’ capital release strategy, offering flexibility while maintaining operational control.

The portfolio’s prime locations mean about one in four Australians lives within a 30-minute drive of the sites. With the real estate zoned for urban use, future redevelopment potential adds to the value proposition.

Charter Hall and BWP Trust are among companies already heavily invested in Bunnings real estate, with previous deals in the sector showing yields around 4.6-4.9%.

The current offering is expected to attract both local and international institutional investors.