Mixed-use property at Five Ways, Paddington, tipped to fetch more than $6 million at Burgess Rawson auction

The retail tenancies are occupied by Sonoma Bakery and Mr T’s Vietnamese Restaurant, which contribute to a net income of $207,225 a year, excluding GST.

Burgess Rawson selling agent Tom Doran, who has the listing with colleague Dean Venturato and Laing and Simmons Double Bay’s James Agnostini, said the property was underdeveloped and under-rented.

He said the vendors, an eastern suburbs family, could see an opportunity to get more out of the property but are selling as they are not prepared to undergo a major revamp on the building.

“A lot of these people have owned these properties forever; they’re (the owners) not geared to redevelop or reposition, so they look at maximising the values out of it now by selling the asset rather than rebuilding or spending money on a new fit-out which a lot of the older owners aren’t geared towards.”

The property is at the Five Ways intersection. Photo: Supplied

Mr Doran said the site previously had a development approval, which had since lapsed, for two shops and a boarding house with 14 rooms.

But several buyers are looking at lodging an application for similar plans.

“When that was approved back in 2013, people couldn’t really get their head around boarding rooms,” he said.

“But now, because of Airbnb, some investors are looking at buying it, redeveloping it into 14 boarding rooms and then leasing each individual room out separately.”

The listing has received more than 180 inquiries and at least 20 contract requests, some from investors who want to clean the place up and increase rents. Others are families who are looking to invest money while getting their children into a unit.

“So it’s more of a family purchase where the parents will fund it but the kids will be responsible for paying back some rental and that gets them into the property market,” Mr Doran said.

He added that Five Ways in Paddington was a “very sought-after position” with mostly food-operator tenants, which was preferred by investors due to its long-term business viability.

The Paddington property is one of 27 commercial properties across NSW, Queensland, Australian Capital Territory and Western Australia set to go under the hammer at Burgess Rawson’s Sydney portfolio auction on Tuesday – with price expectations ranging from $500,000 to $16 million.

In Sydney’s inner west, three retail strata properties in Rozelle, are being auctioned individually – attracting more than 100 inquiries and 24 contract requests.

Of the seven childcare listings, Little Scribblers in Southport, Queensland, sold prior to auction for $2,850,000 on a 5.85 per cent yield.

The portfolio auction will be held at Doltone House Hyde Park, 181 Elizabeth Street, Sydney, from 11am.