Demand still strong for some properties despite whispers of a softening market
A corner building in a popular inner west surburb of Sydney that houses a real estate office and café sold under the hammer for $5.5 million at Burgess Rawson’s latest portfolio auction, where $29 million of commercial property was snapped up.
The two-storey building at 117 Majors Bay Road, Concord, was among 12 prime sites in metropolitan and regional locations to achieve strong results at Tuesday’s auction, where the overall clearance rate was 57 per cent.
Six bidders vied for the Concord building, which came with a five-year and a three-year lease, plus options to McGrath Estate Agents and Frappe Café. It sold on a 4.88 per cent yield.
Burgess Rawson associate director Kieran Bourke said the property was always going to be popular because of its prime location and near-new condition.
“We had plenty of interest from local Sydney investors and it’s unsurprising given Concord as a suburb to invest in is highly sought after and very tightly held, with the 40-metre retail frontage building being immaculately presented on a busy intersection,” he said.
The Concord retail building has a 40-metre street frontage. Photo: Burgess Rawson
Commercial property assets across the ACT, Queensland and NSW were sold at the portfolio event.
Sales included a retail site in Bondi Junction, leased to Jaycar Electronics, which sold for $4,445,000 on a 4.89 per cent yield; a shopping centre in Bonnet Bay, in Sydney’s south, was bought for $3.76 million on a 5.93 per cent yield; and an Autobarn in Kelso/Bathurst, in central west NSW, was snapped up for $1.71 million at a yield of 5.46 per cent.
Burgess Rawson director Dean Venturato said the demand for these types of properties across the eastern seaboard and in rural areas remained strong, despite whispers of a softer market.
“The sale of the Jaycar site in Bondi Junction clearly demonstrated the strength of the eastern suburbs’ market – just four years ago this property sold for $2.04 million and today it was purchased for more than double that,” he said.
The Bondi Junction property was another that was keenly fought over at auction. Photo: Burgess Rawson
“There was immense interest from a combination of investors who were looking to take advantage of the great retailing location, as well as developers who realised great benefit in the approved DA for a 21-room boarding house.”
Other sales included a Tradelink site at Parkes, which sold for $1,435,000 at a yield of 6.43 per cent; the Gracelands Hotel, also in Parkes, for $2.38 million at 8.04 per cent; a South Lismore pharmacy for $1.4 million at 6.34 per cent and a Mooloolaba 7-Eleven convenience store for $2.5 million at 8.02 per cent.
A building in Armidale, in the NSW New England region, that houses an accountancy firm was purchased by a private investor for $2,275,000 on an 8.57 per cent yield prior to auction, as was a Westside service station in Blayney, in the NSW central west, for $3.4 million on a 6.87 per cent yield.
The Armidale building, at 135 Beardy Street, is freestanding and comprises 569 square metres with front, side and rear access and has a new five-year lease, with options to 2034.
Nine other properties that passed in are under negotiation.
