Rubber hits the road at record Leongatha auction

A record price was paid at auction today, Wednesday, May 10, for the Goodyear Autocare site and premises at 12-14 Anderson Street Leongatha.

According to principal of commercial real estate sales specialist, Burgess Rawson of Lonsdale Street, Melbourne, Raoul Holderhead, the winning bid of $1,035,000 underscores the attraction of Leongatha as a commercial and residential town in regional Victoria.

“The auction went ‘Barny Bananas’. We had 144 inquiries and 25 people pre-registered and paying the deposit as a registered bidder, a number of them from the local area,” Mr Holderhead said.

“In the end, the winning bid was $1.035 million which represented a 3.75% yield on investment which would be a Leongatha record, I believe.

“How good is that for Leongatha,” he enthused.

Mr Holderhead said the underbidder in the spirited auction, staged in a reception room at Crown Casino, was a local investor.

“It’s a terrific result for Leongatha. People at these auctions are looking for freehold and property first, position second and secure tenants next.

“This business has been in place for what, 50 years, the existing lease runs to 2026, at which time there will be a review and we can see it moving up from the present $38,889 per annum to between $55,000 and $60,000.

“But it’s an excellent result for Leongatha. We all know what a strong regional town it is and results like this underscore that.”

Mr Holderhead, a born and bred former resident of the town, said the Goodyear tyres building was uniquely central to highway activities including the likes of McDonalds, KFC, Subway, BP, Ampol, United, Autopro and IGA Liquor; which backed its on-going value as a commercial site.

“We had 15 properties up for auction today, including four in regional Victoria at Ararat, Wodonga, Ballarat and Leongatha, with 11 of the 15 selling but without a doubt, the Leongatha result was the most ahead of expectations.

“The reserve was $850,000 but that’s what happens when you have several motivated bidders.”

Burgess Rawson and Nutrien Harcourts were offering the property for auction in conjunction.

They listed the following investment highlights:

+ Secure 5-year head office lease to January 2026 plus options to 2032.

+ Goodyear Autocare: wholly owned subsidiary of Goodyear Tyre and Rubber Company (NYSE:GT), operating over 140 sites nationally. (1)

+ Goodyear Tyre and Rubber Company (NYSE:GT): one of the world’s leading tyre companies with annual sales in excess of $15 billion. (1)

+ Investor preferred net lease terms with Goodyear Autocare paying all usual outgoings incl land tax.

+ Fixed 3% annual rent increases assuring growth.

+ Low rent per/sqm providing for significant future rental uplift.

+ Proven auto retail position with tyre service centres operating on site for over 55 years.

+ 370sqm* freestanding building incorporating showroom, offices and servicing plus canopy.

+ Prime 1,743sqm* freehold corner landholding with combined 79 metre* dual frontage and exposure.

+ High profile South Gippsland Hwy position, major thoroughfare connecting Melbourne to Wilsons Prom.

+ Amongst McDonalds, KFC, Subway, BP, Ampol, United, Autopro and IGA Liquor.

+ Strategically positioned less than 150 metres from the Leongatha CBD.

+ Booming regional centre with Leongatha house prices up 20.5% over past 24 months. (1)

+ First time offered in over 35 years.

+ Potential 50% stamp duty saving.

+ Leongatha: capital township of South Gippsland, rich dairy region, circa 15,000 trade catchment.

+ Net Income: $38,839pa* + GST.