Super surge stoking Port Macquarie market, says Raine and Horne

A spike in self-managed super fund investments on the NSW mid north coast is driving commercial asset price growth, according to Raine and Horne.

Port Macquarie co-principal Grahame Garrett says a combination of healthy yields and relative affordability are behind an increase of commercial purchases via SMSFs in the region.

Yields for industrial stock in the sub-$500,000 range sit near 8 per cent, and 6.75-7 per cent for retail and 8 per cent for office space.

“Our proximity to Sydney and Newcastle is attracting investors from those cities through a combination of our healthy yields and commercial real estate affordability,” Mr Garrett said.

“When you can buy two or three assets in Port Macquarie for the equivalent of a single-tenant property in Sydney, investors see this as value.”

There had been an increase in both investors wishing to retire to the region as well as business purchasing premises via an SMSF and then leasing them back to the business.

“We auctioned a retail property to a Sydney investor, who purchased it through a self-managed super fund, and who intends on retiring to Port Macquarie down the track,” Mr Garrett said.

“There are also those small business owners who are acquiring properties through a SMSF and then leasing them back to the business, which the current superannuation laws allow.

“SMSFs leasing a commercial property back to a related business is a common trend in the sub-$500,000 market in Port Macquarie.

“We’re also seeing SMSFs buying industrial stock priced around $400,000 to lease back to a related business.”