This article is from the Australian Property Journal archive
IN one of the biggest commercial retail auctions in Melbourne this year, the dominant National Australian Bank branch corner building in South Yarra has sold under the hammer for $16.2 million.
Located at the intersection of the Chapel Street and Toorak Road high streets, the property sold on a very low yield of 2.53% and a land rate of $43,400 per sqm – one of the highest land rates for a freestanding retail investment outside of the Melbourne CBD, according to Colliers selling agents Matt Stagg, Tim McIntosh, Daniel Wolman and Leon Ma.
Bidding kicked off at $14.5 million with four bidding parties, both local and offshore, fighting for the property. After 40 bids, the property was sold under the hammer to a local private investor.
Over 200 enquiries from local and offshore investors, high-profile retailers and developers were received throughout the campaign.
“We knew this was going to be one of the most sought-after commercial auctions in Melbourne this year, as flagship buildings of this nature in iconic locations are prized investments by virtue of their irreplaceable location,” Stagg said.
The building has been home to the major lender for over 70 years as one of their flagship branches and it recently signed on a new five-year term following a major $1.5 million refurbishment. It last sold in 2013 for more than $12.82 million, on a 4.6% yield.
McIntosh said, “ultra-defensive freestanding retail investments anchored by ASX-listed covenants and boasting a long lease continue to show their resilience in any market cycle”.
In Melbourne’s inner eastern suburbs, another NAB branch in Camberwell sold for $6.6 million, but the bank had only a few months remaining on its lease.