Investors place their bets on TAB, regional pharmacies
Investors have put their cards on the table at this month’s Sydney Burgess Rawson portfolio auction, with some taking a punt on a property leased to a TAB and others following sea and tree changers to the regions.
All 10 properties on the auction list sold for a disclosed total of $24.314 million.
A Neutral Bay property on a 10-year lease to Tabcorp sold for $3.4 million at Tuesday’s auction, and had received more than 100 inquiries before auction day. On busy Military Road and near Coles and Woolworths stores, it’s expected to return $159,570 a year plus GST to its new owner.
And, interest in regional properties remains strong. Two properties leased to pharmacies sold at the auction, held at the Sydney Opera House.
A suburban pharmacy in Cardiff, Newcastle, leased to Star Chemists, sold for $2.655 million, and a pharmacy in Nowra, on the NSW south coast, sold for $2.755 million.
The Cardiff chemist is on a new 10-year lease until 2031, with options to extend to 2051, and fixed 3 per cent a year increases. It’s set in a medical precinct near two medical centres and radiology and pathology services.
The Nowra property is leased to Chemist Warehouse, and a selling point was its location — two hours from Sydney and in a town that’s quickly adding to its population of 34,000.
Regional growth
Burgess Rawson associate director Kieran Bourke said the sales were a “testament to this growth corridor regional NSW is experiencing”.
“With the trend of people moving away from central-city locations into regional areas, we have noticed a shift in the market with regional assets becoming increasingly more sought after,” he said.
Burgess Rawson director Simon Stadden said confidence in the regions, and especially in medical assets, was here to stay.
“We see investor confidence in regional areas to be a long-term transition, not just the current climate due to COVID,” he said.
Mr Stadden said interest in essential services remained. “The sale of two pharmacy tenanted investments including Chemist Warehouse in Nowra for $2.755 million and the pre-auction sale of a medical centre in Mona Vale emphasises the strength and demand of the essential service medical asset class, this sector is incredibly hot right now and growing in popularity.”
Also sold on Tuesday was a property leased to a Liquorland in Cairns for $1.29 million, and a Richmond, NSW, property leased to Commonwealth Bank and St Vincent de Paul for $2.938 million.
