Commercial auctions defy interest rate hike

Published on: 11/05/2022

A Northern Sydney IGA was scooped up for more than $10 million at yesterday’s Burgess Rawson portfolio auction, which was otherwise headlined by petrol stations and childcare centres.

The Sydney event netted a 92% clearance rate, with eight properties selling under the hammer and another three being snapped up prior to auction.

The Freshwater IGA on the Northern Beaches also achieved the day’s tightest yield, of 4.78%. Home to IGA for over 30 years, it has a 10-year lease to 2031 plus options.

Childcare centres in Cowra and Coffs Harbour sold at the event, while an investor bought an entry-level Albion Park facility, in the Macquarie Valley, for $1.6 million on a 4.2% yield.

The Goodstart Early Learning facility in Cowra sold for $3,380,000 on a 4.99% yield with a 10-year lease to 2030 with a further 10 year options and a licence for 90 places, while the Coffs Harbour Petit Early Learning asset sold for $4,450,000 at 5.4%, with a 15-year lease to 2030 plus five-year options.

Regional NSW petrol stations were also a feature. The Orange 7-Eleven, on 2,076 sqm of land with highway frontage fetched $6.1 million, at 5.57% on the 15-year lease to 2035 plus options through to 2055, while before the auction an investor picked up the Wagga Wagga Mobil for $7,500,000 on a yield of 5.69%. It has a brand new 15-year lease with options to 2052 and is on a corner parcel of 8,327 sqm.

Also selling was the Randwick Australia Post with a renewed three-year lease plus a three-year option, for $1.65 million on a 5.10% yield.

Braybrooks Pharmacy in Cootamundra sold for $725,000, at 5.52%, the Rhodes Kildea Lawyers offices in Moree netted $799,000 on a 6.94% return, and a motel in Tomingley sold for $1,150,000 at 7.06% with a lease until 2028 plus options.

Australian Property Journal


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