Landmark Hobart building sale sets low-yield record: Knight Frank
A landmark Hobart historical property in an up-and-coming cultural and contemporary hub has achieved the lowest yield on record for an investment property in Tasmania, according to Knight Frank.
An auction crowd of more than 100 people, including international visitors, watched as an undisclosed local buyer secured the three-storey Georgian sandstone building, which is close to the popular Salamanca Markets as well as the new Parliament Square development at Sullivans Cove.
Eight bidders drove the sale of the 1830s building at 21-23 Salamanca Place, Battery Point, to its sale price of $7.8 million with a yield of 3.47 per cent.
The first stage of the new urban precinct, the Salamanca Building, is due to be completed at the end of 2016 with the final stage expected to be finished in 2018.
Salamanca Market, in Hobart. Photo: Tourism Tasmania
Knight Frank Tasmania chief executive Scott Newton said the appetite for the property was testament to the historically strong Hobart investment market.
“Yields are now breaking below 6 per cent consistently, with this property receiving the lowest yield on record to our knowledge for an investment property in Tasmania,” Mr Newton said.
“This was a highly competitive sale. In one of the most highly sought-after areas in Australia, it sold well above the reserve and exceeded expectations.”
The ground floor of 21-23 Salamanca Place is occupied by tenant Irish Murphy’s tavern, with the upper two levels consisting of renovated offices.
On the third floor is the Salamanca Loft, a newly refurbished two-bedroom unit with painted sandstone walls, two skylights in the lounge and a glass atrium.
The upcoming development of Parliament Square nearby will comprise a mix of office, hotel and retail spaces.
Heritage buildings surrounding the square will be restored while contemporary additions to the precinct will house a new boutique hotel.
