This article is from the Australian Property Journal archive
A MULTI-tenanted building on one of Australia’s premier shopping strips, Church Street in Brighton, has sold for $16.2 million reflecting a 3.8% yield.
The fully-leased heritage-style 990sqm building at the 931sqm 71-73 Church Street & 36 Carpenter Street corner site sold at a $17,363/sqm land rate and a $16,480/sqm building rate.
Chris Kombi and Mark Talbot from Fitzroys, along with Jeremy Gruzewski and Liam Rafferty from Aston Commercial, managed the sale of the asset via an expressions of interest campaign, which garnered interest both locally and Australia-wide.
“Most of the enquiry came from passive investors attracted to the strong lease profile, significant passing income and excellent corner position within Melbourne’s strongest performing strip retail centre,” said Kombi.
The property offers its new owner a diversified income stream with secure leases to major retailers including Nike, Ecco and Laurent bakery, as well as office tenants White Fox and 2 Construct, providing potential buyers with a combined income of $705,886 per annum plus outgoings and GST.
“Investors consider income-producing, well-located bricks and mortar assets with long-term leases to quality tenants to be among the most secure investments in the COVID-normal and low interest rate environment. We’re also seeing more investors anticipating higher inflation and turning to commercial property in favour of having money sitting in the bank,” added Kombi.
The tightly held Church Street strip, which has seen only two other properties change hands since September 2019, benefits from a high level of foot traffic and offers leading tenants such as Woolworths, the iconic Dendy cinema complex, major banks and leading retailers Scanlan & Theodore, Mecca, Witchery and Kookai.
“Church Street, Brighton serves one of Melbourne’s most prized catchments, which has maintained a strong demographic with high disposable income and a consistently high median house price, and is home to highly sought after private schools, sporting facilities and popular beach attractions,” said Gruzewski.
“This iconic property represents one of the largest land holdings along this blue chip, highly sought after shopping strip. Securely leased to high-end tenants, this significant freehold offered investors with a once in a generation opportunity.” Rafferty said. “With heritage constraints the property had restricted development potential and was well leased making it a pure set and forget investment and therefore attracted high net worth investors looking for secure income with strong underlying land value.”
