Rapidly growing Melbourne agency Stonebridge Property Group, in conjunction with NSL Property Group, have sold an industrial / office investment in Melbourne’s north for close to $9m, reflecting one of the sharpest recorded yields in the area for strata titled assets.
The purpose-built office warehouse at 38 Sheehan Road Heidelberg West, was leased on a 12 year lease to ‘Simply Delish’, a food manufacturer who supply to Coles, Woolworths, Aldi + more.
The 4,850sqm landholding contains a 3,753sqm office and warehouse and 19 exclusive and 24 shared car parks. The property generates $447,743 in net income and was sold on a 5% yield.
The property was marketed by Rorey James, Dylan Kilner & Kevin Tong from Stonebridge Property Group and Guy Naselli from NSL Property Group
Through a public sale campaign, the vendor was able to realise a capital gain of close to $2m in just 18 months after purchasing directly off the tenant in 2019, reflecting a major yield compression of more than 200 basis points.
Somewhat intriguingly, Stonebridge Director Rorey James noted that the “campaign saw traditional retail and office building investors participate in a very different asset class, as a sheer weight of aggressive capital continues to seek long leased passive investments in Victoria”
“The campaign not only generated a diverse spread of buyer types, it also saw offers made from the states of Tasmania, NSW and Victoria, along with 2 mainland Chinese groups; again highlighting the spread of confidence in the investment sector.” Said Mr Kilner
Stonebridge Property group noted all groups who missed out would continue to look for these passive investments, with the alternative of leaving money in the bank or in a term deposit continuing to be a driver of the low yields they are prepared to pay.
A larger industrial asset in the same pocket of Melbourne is being prepared for sale by Stonebridge, for all enquiries please contact the agency direct.
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