Lygon Street, Carlton restaurant sale yields 4.3% in $1.87 million sale

A freehold Lygon Street, Carlton restaurant premises has sold for $1.87 million, reflecting a 4.3% yield.

The 128-130 Lygon Street premises sold to a local investor subject to a five-year lease at $81,000 a year.

The tenant operates an Indian restaurant, Royale Fusion at the 128 square metre holding.

With 230 square metres available space, it sold through Matthew Feld and Larry Takis from Teska Carson.

There was a recent sale at 112 Lygon, but its price has not been revealed, although Property Observer gathers next door sold last December when 110 Lygon fetched $1.5 million. They were both three storey terraces on around 120 square metres.

Last December 346 Lygon sold for $2.48 million. It was an 96 square metre holding that was up for lease at $100,000 in 2009, and then eased to national retailer Moss River. It was reportedly the first time 346 Lygon Street had been offered for sale since 1921. Teska Carson's Michael Ludski said the two-storey building in the retail precinct sold on a 4.01% yield after acquisition costs. It was subject to a new five-year lease at a net annual rental of $105,000.

Knight Frank secured $3.77 million in October last year when an 136 square metre Faraday Street corner offering at 350 Lygon went to auction.  Laree Jane, the former wife of businessman racing driver Bob Jane, was the vendor of the historic, two-storey building leased to Grill'd restaurant. It sold on a low yield of 4.2%. It had also sold at $695,000 in 1992. 

In 2012 the home of Donati's Fine Meats at 402 Lygon Street sold under the hammer for $2.89 million (pictured below).

The sale of the two-storey building on a 75-square-metre site set a record for the strip, a very tight yield of 2.31% through Colliers International selling agents Jeremy Gruzewski and Tom Noonan.

The 402 Lygon Street building was up for sale for the first time in 100 years, having operated as a butchery since the early 1900s, with Donati's based there since 1972. 

Other sales on Lygon Street were the 84-square-metre premises of Intrepid Travel at 231 Lygon Street, which sold for $1.9 million in 2011 equating to $22,619 per square metre and a passing initial yield of 3.62%, and 163-165 Lygon Street, the premises of Casa Del Gelato, which sold for $2.8 million ($10,294 per square metre) in 2010 on a yield of 3.48%.

In absolute terms, the highest price paid since 2008 was $3.71 million paid for 350 Lygon Street, a two-level corner site in 2009 measuring 173 square metres, equating to $21,445 per square metre.