Vacant shop in Ermington sells for $450,000 more than its reserve price
A vacant shop in the Sydney suburb of Ermington was one of the standout results at the most recent Burgess Rawson portfolio auction, achieving a per square metre sale price that wouldn’t be out of place in prestige markets like Mosman or Double Bay, according to the selling agent.
The property, at 531-537 Victoria Road, sold for $1.45 million – $450,000 more than its reserve price – or $20,714 a square metre.
“That [figure] is not out of place in Mosman and Double Bay,” said agent Tom Doran, from Burgess Rawson.
The elderly couple had held the property for an extended period of time, according to Mr Doran, and tenants had included a $2 shop and a photo-processing facility.
The property was most recently rented for $54,500 a year net.
“On the past income, a yield of 3.79 per cent would have applied,” Mr Doran said.
He said that marketing the property as vacant was an important strategic move, considering the strong demand from owner occupiers in the Ermington area.
“The owners saw that we sold two properties in Ermington late last year. They came to us after those sales and said ‘We have a tenant vacating – should we get another tenant or sell as vacant possession?’ We advised that an owner occupier would be interested in a vacant offering.”
Burgess Rawson then set about attracting the attention of local business owners, including a 8000-strong letter drop and a targeted Facebook advertising campaign.
Listings at the 531-537 Victoria Road shopping complex have proven popular in recent months.
Late last year Burgess Rawson sold two neighbouring properties in the Woolworths-anchored complex.
A 63-square-metre sushi shop at lot 3, 531-537 Victoria Road, Ermington, sold for $1,165,000 on a 5.19-per-cent.
Meanwhile a 202-square-metre property at lot 4, leased to a chemist, netted $2.21 million on a 5.09-per-cent return.
The centre’s appeal with both owner occupiers and investors can be attributed to the infrastructure incorporated with the shopping centre.
“Ermington has got a significant amount of customer parking, more than 100 spaces, and property rarely comes up for sale.”
The suburb is 18 kilometres north west of the Sydney CBD and is in a fast-growing area of the city.
“Ermington is in between two of the infrastructure hubs of Australia – Parramatta and Ryde. Within three kilometres of our site its quite a dense residential area.”
The portfolio auction recorded a 93 per cent clearance rate on the day – seven assets sold under the hammer, six changed hands shortly after the auction and one was bought before auction.
A NAPA automotive retail site in Slack’s Creek, Queensland recorded the day’s best result, selling for $11.7 million, on a 6.61 per cent yield.
A Young Academics Childcare at Kellyville’s The Ponds sold for $3.45 million on a 5.36 per cent yield, and another childcare property in Auburn sold for for $4.175 million, on a 5.35 per cent yield.
A Bowral property, currently leased to two-hatted restaurant Biota Dining, failed to find a buyer.
Sydney assets recorded a particularly strong showing, said Mr Doran, reflecting the re-entry of investors into the market.
“Everyone wants a property around Sydney. Because rates are so low, a lot of people want to get their money out of the bank and are going back to property,” he said.
