DTZ Australia has sold a small retail property in Swanston Street, Melbourne for record $4.76 million, on an indicative yield of 5.1%.
The property is located at 55 Swanston Street, adjacent to the Flinders Lane corner.
Shop 1 is located on the street level of the 10 level office building the property has an area of 84 sqm with a street exposure of approximately 7.7 metres.
The property is currently leased to Carrington Giftware, which commenced a new 10-year lease from July 1st with two further five year options to renew. The current net annual rental is approximately $243,000 plus GST with fixed 5% annual rental increases.
There is provision for a market review at the end of the first five years and on the lease option to renew dates.
“Swanston Street doesn’t get much better than this property with its huge passing pedestrian flows and a virtual nil vacancy factor for retail properties.” DTZ Australia’s Ken Smirk said.
Smirk had fielded an hour long duel between two bidders for the property once bidding passed the $4 million mark. The purchaser is a long established Melbourne CBD retailer with prominent CBD retail property holdings.
The property was previously auctioned by DTZ Australia about two years ago when it was purchased by the vendor for $3.34 million.
In addition, DTZ Australia sold a second CBD retail property investment – an IGA X-press supermarket located at 123 Elizabeth Street – with a lease running to 2013.
The property has an area of 255 sqm and a rental of $295,036 plus GST, but was passed in at $4.75 million.
DTZ Australia said negotiations are continuing for that property.
By Kathryn O’Meara
