CBD shops sold on yield below 3pcPosted by On

Mr Hay and Colliers colleagues Leon Ma, Daniel Wolman and Matt Stagg, along with JLL’s John Rutman, Nick Peden and Mingxuan Li, were the selling agents for the property. It received eight bids from local and international investors.

Adding to the attraction of property is its underlying land – it stands on a 413-square-metre site, which provides plenty of scope for redevelopment. The leases for the buildings’ six tenants allow for vacant possession by 2027.

While that redevelopment potential boosts value, the Lonsdale Street transaction is also one of a number of retail property deals in the past year struck on very tight yields.

Last November, a local investor snapped up a new-format Coles supermarket in Melbourne’s inner suburbs for $24.5 million on a yield of just 1.9 per cent.

Earlier this month, supermarket giant Woolworths bought a small suburban Sydney retail centre, in which rival Coles is the main tenant, for about $68 million, on a yield well below 3 per cent.

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