This article is from the Australian Property Journal archive
ANOTHER two Sydney co-living asset have been snapped up with the sale of an established accommodation operation for $10.4 million and a development site for $9.8 million.
Gordon McFadyen and Dylan McEvoy from JLL managed the sale of the Kingsford properties private investors.
The established property at 65 Willis Street, known as UniStudio, was sold at a 6.48% yield and comprises a modern four-storey building with 33 self-contained fully furnished studios.
Each of the studios features kitchen and bathroom facilities, living/study space and select rooms include balconies or outdoor spaces.
The property provides a net passing income of $608,128 per annum and sits close to UNSW, the Prince of Wales Health Precinct, and the Kingsford Light Rail line.
While the development site at 87-91 Middle Street is DA approved to construct a 68-room New Generation Boarding House, with the purchaser planning to develop and hold the property.
“The appeal of Co-living developments is that they offer a greater density on-site and provide investors with a diversified cash flow from the multi-unit projects,” said McFadyen, joint head of metropolitan sales and investments at JLL, NSW.
JLL alone has totalled more than $250 million in co-living sales over the past two years.
While Knight Frank recently sold 89 Balmain Road in Leichhardt for $3.18 million in the highest rate per studio transaction for a co-living site for Sydney’s Inner West.
Knight Frank has also listed the brand new five-level co-living building at 465-467 President Avenue in Kirrawee, with expectations of $20 million-plus.
McFadyen also noted the asset type provides market exposure to private investors and smaller funds looking to take advantage of current residential rental increases, with demand for medium-term accommodation growing as supply remains tight.
“Co-living appealed to investors as it is cheaper to operate than serviced apartments and has the flexibility to tailor service offerings,” said McEvoy, joint head of metropolitan sales & investments at JLL, NSW.
