Prominent West End retail site sells for $2.9 million as buyers pounce on inner-city Brisbane buildings
As the suburb of West End on Brisbane’s city fringe undergoes significant gentrification, some of its older buildings have been generating a lot of interest at auction.
A heritage-listed building at 201 Boundary Street recently sold for $2.9 million under the hammer, on a net yield of 6.1 per cent.
Peter Laoudikos, who managed the sale for Ray White Commercial, says historic buildings in the inner city rarely come up for sale but are snapped up quickly when they do.
“What we saw with that sale was definitely an emotionally-driven purchase, because the buyer drove that yield price down. Most investors want to keep things around that 7 to 8 per cent yield and something selling around the 6 per cent is definitely a sale that’s driven by more than just a dollar profit,” he said.
The building is on a busy thoroughfare and had been owned by the same family for several generations. Photo: Supplied
The property had previously been held by the same family for generations and was purchased by a local investor who owns other properties on the street and keenly waited for another to become available.
After more than 70 inquiries during the sales campaign, six bidders competed for the site at auction.
The property sits on a retail precinct at the corner of Vulture Street, adjacent to two of the area’s busiest thoroughfares for pedestrian and traffic.
The fully occupied building is anchored by 7-Eleven and earns a net income of $177,000 a year.
The other four tenants are West End Coffee House, Govinda’s Restaurant, aromatherapy product retailer Perfect Potion and creative agency The Room.
It has a gross lettable area of 382.5 square metres and a land area of 245 square metres.
The inner-city suburb of West End has seen a lot of gentrification in recent years. Photo: Supplied
Mr Laoudikos said that the West End fringe commercial market was performing strongly compared with the CBD, and the suburb was likely to look very different in the next 10 to 15 years.
“That West End area was an area that needed gentrification. It used to be more of a working class area but because it’s so close to the city we’re seeing a lot of redevelopments and new buildings going in both commercial and residential.
“It’s still going to keep a community feel, it’s definitely got that arthouse kind of look to it and that will stay there, but you’re going to see a lot more money being driven into that area for sure,” he said.
Increased residential development in the area is helping to fuel strong commercial sales.
Nearby to the Boundary Street site is Sekisui House’s $800 million West Village apartment precinct, spanning eight apartment buildings, where Stage One is currently under construction.
The development, on the former Peter’s ice cream factory site, will also have a supermarket, shops and galleries linked by laneways.
