Sharp yields for retail assets have travelled beyond Melbourne’s suburban boundary and down to the Bellarine Peninsula, with Fitzroys achieving a landmark result in their first auction of the year.
National interest generated by an aggressive marketing campaign saw the prime Ocean Grove strata asset sell under the hammer for $2.465 million at a remarkable 4.1% yield.
Agency Director Mark Talbot and Associate James Lockwood sold the Pharmasave chemist at 76A The Terrace after receiving more than 100 enquiries, leading to spirited bidding between multiple parties and an interstate investor eventually winning out with the sale price $565,000 above reserve.
The property comprises a 327 sqm single-level building leased to long-term tenant Pharmasave, on a two-year deal with two further four-year terms from July 2017.
With a prominent frontage of more than 10 metres, it occupies a prime position in the Ocean Grove retail village, directly opposite a Coles supermarket and a busy pedestrian crossing, and next to the Council’s proposed Town Square development site.
Talbot said the result showed that tight yields of this nature for retail and commercial strata assets were once only typically seen in Melbourne’s inner suburbs.
“Strong sales results have been spreading through to the edges of metropolitan Melbourne across the bay recently, but this is a landmark result beyond the suburban boundary, nearly 100 kilometres from the CBD,” he said.
Lockwood said the marketing campaign reflected the ability of Fitzroys to reach prospective buyers across Australia.
“Ocean Grove is a thriving beachside village surrounded by specialty retail and hospitality options, and is a highly regarded tourist destination with an established local population,” he said.
“Properties like these can be overlooked by potential purchasers because of their location, but they can be put on the radar by the right agents who understand what kind of marketing campaign is necessary.”
The retail village is home to a strong mix of national and local traders, including Coles, CBA, ANZ, Australia Post, NAB, Target and numerous local cafés and restaurants, and Ocean Grove is close to coastal attractions including surf beaches, the Barwon River and the Ocean Grove Nature Reserve.
The Ocean Grove town centre services the local catchment taking in Barwon Heads, Wallington, Point Lonsdale and Queenscliff.
Sutherland Farrelly will offer a rare Lygon Street redevelopment site for public auction on Thursday, 22nd March at 2pm.
Zoned Commercial 1, the site at 280 Lygon Street, has a land area of 154 square metres (approx), total frontages of 37.8 metres (approx), with excellent exposure to Lygon Street.
The property forms part of the vibrant restaurant and retail strip located near the intersection of Grattan Street, in proximity to the Melbourne Museum and Carlton Gardens.
Marketing agent Paul Sutherland said the property provides an excellent redevelopment opportunity, noting its corner location fronting to Lygon Street and Beard Place.
The property is being offered with vacant possession and is expected to realise in excess of $2,250,000.
A Little Collins Street space in Melbourne’s CBD has attracted huge demand from a range of operators.
Fitzroys agent Terence Yeh leased the 38 sqm Shop 3, 188 Little Collins Street to Little Temperance café on a 5+5-year deal at $90,000 per annum net, with 4% annual increases.
Yeh said the typical rate for a similar space would be around $1,800 per sqm, but a rate of $2,368 per sqm was achieved.
“More than 60 enquiries were received from hospitality, fashion and service retail operators, looking to capitalise on the CBD worker population and the rapidly growing residential catchment in central Melbourne,” he added.