The Prahran property is one property that was snapped up by investors since the outbreak of coronavirus. Photo: Supplied

The commercial properties being snapped up during the coronavirus crisis

Ray Sparvell|Apr 08, 2020

COVID-19 is prompting a level of anxiety around all business activity in Australia, but a variety of very recent sales show there is still some confidence in the commercial property sector.

The ACT recorded its first big commercial property deal for 2020 earlier this month with a $39.3 million sale of a fully tenanted office building in suburban Bruce.

KM Property Funds, a division of the KordaMentha Group, added to its portfolio 1 Thynne Street, a purpose-built 5848-square-metre property leased until 2029.

Colliers International director Matthew Winter said it was fully tenanted by the Australian Institute of Health and Welfare.

officebuildingbruce — The office building in Bruce, ACT, fetched almost $40 million, the biggest sale in the territory this year so far. Photo: Supplied

“Total site area is 9578 square metres with mixed-use zoning, which would permit additional future uses,” he said.

“This sale demonstrates how the Canberra market continues to appeal to investors seeking stability.”

The six-year-old building is close to the Belconnen town centre and a short walk to the University of Canberra.

Meanwhile, in Port Macquarie, on the NSW mid-north coast, a recently renovated 75-place city childcare centre changed hands on March 31 for $3.02 million.

portmacquariechildcare — The Port Macquarie childcare centre sold for more than $3 million. Photo: Supplied

The centre is on a 2267-square-metre site and is managed by an experienced operator on a 20-year lease until 2037, with options to extend.

Michael Vanstone, of Burgess Rawson Sydney, said the sale showed that investors were attracted by the security and returns of childcare centres.

“Well-managed childcare centres located in areas of high demand are extremely attractive to investors, offering healthy yields and long-term security,” he said.

Residential sites continue to attract investor and developer interest and that appetite delivered a $11.4 million sale in Sydney’s eastern suburb of Randwick on March 31.

randwickunits — The two blocks of units sold for $11.4 million. Photo: Supplied

Two unit blocks on a combined 1305-square-metre site were snapped up in a spirited 35-minute auction.

The two residential apartment blocks, at 9 and 11-13 Mulwarree Avenue, have a combined 24 two-bedroom units.

Elements of art deco style highlight the desirable red-brick constructions with significant refurbishment and development potential.

Nick Heaton, of CBRE Sydney, said the inner-city location proved irresistible.

“Confidence in the Sydney property market remains high even within the backdrop of COVID-19,” he said.

prahrandevtsite — The Prahran property can continue to be rented out as a medical practice or redeveloped. Photo: Supplied

“Investors tend to play the long game and these 24 units on a big block of residential land offer great potential.”

The property is next to a light rail station, and close to the Royal Randwick shopping centre, the University of NSW and Centennial Park.

A potential redevelopment site in Prahran, in Melbourne’s east, was sold by expressions of interest on April 3, for $2.875 million.

The 598-square-metre corner block, at 323 High Street, is zoned for medical use with the Avenue Hospital just 350 metres away.

The block is currently occupied by a 161-square-metre medical clinic that has a 56-metre street frontage with access from adjoining Ivy Street.

Charles Carty, of Belle Property Commercial South Melbourne, said the property attracted a high level of interest from investors, medical practitioners and developers.

“It’s a great location with tremendous potential, given its proximity to the hospital,” he said. “The new owner has the option of retaining it as a rental property or as a redevelopment.”