Written by Larry Schlesinger, Property Observer
Commercial property investors have shrugged off concerns about the Geelong economy and job market with two cafes close to the waterfront snapped up by investors on attractive yields at a Burgess Rawson portfolio auction today.
The Beside the Point Café below a seven story residential development at 100 Western Beach Road sold for $462,000.
The café, which adjoins Deakin University and according to auctioneer David Scholes from Auctionworks, benefits from “students nipping out for a coffee” brings in annual net rent of $35,000 equating to a strong yield of around 7.6%.
Bidding started at $400,000 and quickly rose to $450,000 before two bidders competed with $1,000 increases.
The second property to sell was the Steakhouse and Mila Café also at 100 Western Beach Road, which sold for $1.365 million. It brings in net annual rent of $85,000 equating to a yield of around 6.2%.
Both premises were marketed by Wayne Thompson and Andrew Lewis from Colliers International and Raoul Holderhead and Shaun Venables of Burgess Rawson.
The sales suggest investors have not been spooked by the recent spate of job closures announced by Target and Ford with possible further loss of jobs from possible closures of the Shell Refinery and Alcoa’s Point Henry aluminium smelter.
Read the original article here.