A Sydney commercial site set for future redevelopment has sold for $12.7 million, selling for a record rate and a record net passing yield of 3.38%.
Located in the inner suburb of Waterloo, the commercial property fetched a rate of almost $5,650 per sqm of developable floor area, which was a record for a development site in the area.
SHMH 3 bought the 719 Elizabeth Street property, which comprised a 1,127 sqm site and a 1,192 sqm building, from Kavango.
ASX-listed Accent Group occupied the recently refurbished building.
The purchaser intended to redevelop the site into a mixed-use development when the tenant vacated the building in the future.
James Masselos, Demi Carigliano and Anthony Pirrottina of Knight Frank negotiated the deal, which attracted in 180 enquiries and six offers.
“The yield is reflective of what the price would have been at the peak of the market 12 to 18 months ago,” said Pirrottina.
“The strong demand and record price demonstrates that well located properties with good future upside potential are still achieving very strong prices.
“The pricing gap between A Grade and B Grade assets has widened, with premium assets still achieving prices close to their peak.”
Masselos said the property had offered a solid investment opportunity.
“It has outstanding passing income with a secure lease underpinned by an ASX-listed covenant, as well as substantial upside in the form of future redevelopment potential,” he said.
“The property is nestled within the heart of the bustling and ever evolving Green Square, and is a high exposure site, benefitting from 29 metres of frontage to Elizabeth Street and excellent exposure from passing vehicular activity.”