Investors Go All In For Pubs, Fast Food, Petrol

A Brisbane pub leased to drinks giant Endeavour, a Bridgestone tyre centre and a Melbourne Hungry Jack’s restaurant all set records as investors chasing yield spent $76.5 million on commercial property at a mostly online auction yesterday.

Hosted by agents Burgess Rawson amid lockdowns in Melbourne and Sydney, the auction generated a clearance rate of 82 per cent as 23 out of 28 properties on offer sold at an average yield of 4.7 per cent.

‘‘We could sleep pretty well on Monday night [before the auction] knowing all these people had registered to bid,’’ said Burgess Rawson director Raoul Holderhead.

‘‘We had 39 registered bidders for the Bridgestone centre and 36 for the Hungry Jack’s,’’ Mr Holderhead said.

Originally due to be held at Melbourne’s Crown Casino, bidding was allowed online, by phone and in person at the Brisbane Hilton.

The biggest sale of the day was the Royal Exchange Hotel in Brisbane, which smashed its $12.5 million reserve to sell to local investors for $14.05 million on a yield of 4 per cent.

That set a benchmark for pub investments leased to newly listed Woolworths-backed drinks and pokies giant Endeavour. The Royal Exchange was offered for sale by ASX-listed ALE Property Group, which last valued it at $10.7 million.

Bidding for the large format asset commenced at just under $10 million, with registered bidders moving the price quickly into double digits and by $100,000 increments.

‘‘The sale at $14.05 million and at a 4 per cent yield is reflective of the positive asset class sentiment we are tracking nationally,’’ said Glenn Price, a director of HTL Property, which jointly marketed the Royal Exchange Hotel alongside Burgess Rawson.

Five properties sold before auction including a Japanese restaurant in Hobart, and a Perth auto repair shop.