A site ripe for future redevelopment in the inner Sydney suburb of Waterloo has sold for a record rate and passing yield.
The property at 719-721 Elizabeth Street consists of a 1,127sq m site with a building currently on the site providing a net lettable are of 1,192sq m, with 28 underground car spaces.
ASX-listed Accent Group occupy the recently refurbished building, which is ideal for its creative office and merchandise/showroom usage.
The asset was purchased for $12.7 million by SHMH 3 Pty Ltd from Kavango Pty Ltd in a deal negotiated by James Masselos, Demi Carigliano and Anthony Pirrottina of Knight Frank.
The purchaser intends to redevelop the site into a mixed-use development when the tenant vacates the building in the future.
Mr Pirrottina said the property sold for a rate of almost $5,650 per square metre of developable floor area, which was a record for a development site in Alexandria and Waterloo.
He said the net passing yield of 3.38 per cent was also a record.
āThe yield is reflective of what the price would have been at the peak of the market 12 to 18 months ago,ā said Mr Pirrottina.
āThe Expressions of Interest campaign for the property resulted in 180 enquiries and six offers.
āThe strong demand and record price demonstrates that well located properties with good future upside potential are still achieving very strong prices.
āThe pricing gap between A Grade and B Grade assets has widened, with premium assets still achieving prices close to their peak.ā
Mr Masselos said the property had offered a solid investment opportunity.
āIt 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,ā he said.
āThe 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.ā
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