Commercial strata property has reached new heights over the past 3 years, with investors chasing attractive yields, long term secure leases and cashing in on low interest rates. An in flood of both local and international buyers has made the slowly shrinking market move from pedestal to pedestal as desires of attractive returns overruling the low yields and lease terms of the residential market.
The uprise in commercial strata prices over the previous years is due to a number of factors, however with new acquisition laws currently in action proving to be the key player in the increase. The new acquisition laws allow developers to take control of a site should they acquire a 75% stake within the asset. This has seen 6 strata buildings being withdrawn from the market place, shifting strata office’s into an even more niche market.
In the first week of October the largest transaction for 2019 took place breaking the Sydney CBD strata record for a property of 400m2 plus on a $/per sqm basis. The deal, brokered by Tim Noonan & Ben Kennedy of Noonan Property was completed after only three days on the market ultimately selling for $8,800,000 which represents a sale of $21,052 per sqm.
The property was purchased from a local investor with a current lease in place and traded on a 5% yield.
“The properties unique nature is unmatched by anything we have seen, having a full commercial bar, located next to two of Australia’s most iconic landmarks is a winning combination for any investor or tenant” Mr Noonan said.
The generous 418m2, mixed use commercial premises saw a wave of over 200+ enquiries in the short time it was on the market from all types of operators including retail, bar/restaurant and office investors and owner-occupiers. The space featured world class iconic views of the Harbour Bridge, short walking distance to the Opera House, Circular Quay and Wynyard Station.
The property contains two large board rooms, a full commercial-use bar as used by the previous tenant and a large open plan work space. The premises continues to boast its harbour side feature with a 15 meter frontage looking directly onto the water with floor to ceiling windows, capturing every ounce of light.
