Mixed result for petrol station sales at portfolio auction

A group of seven petrol stations were on offer at today's Burgess Rawson investment portfolio auction.

Crown Casino's River Room filled with investors keen to snap up a petrol station or one of the 13 other commercial properties on offer.

The first petrol station to go under the hammer with auctioneer David Scholes was a Woolworths Caltex in the Western Australian town of Katanning.

A rather optimistic first bid was put in at $400,000, which was quite firmly rejected by Scholes.

"You have to start somewhere," mumbled the embarrassed under bidder.

The more realistic starting bid was placed at $900,000, and a group of competing bidders from Melbourne, Sydney and Western Australia brought the price to $1.03 million, often at a pace of $5,000 per bid.

The Katanning petrol station at 137-139 Clive Street (pictured above), which brings in $56,818 per annum, was sold on a 5.52% yield. Woolworths have recently signed a 15 year lease.

The next petrol station up for auction was also leased by Woolworths Caltex. Located at 565-581 Sydney Road in Victoria's Coburg, the site brings in $253,758 per year, with Scholes noting that more than 32,000 vehicles pass by the service station daily.

Woolworths signed a 15 year lease for the site in 2012. The 1,858 square metre property, Scholes noted, is nearly opposite the former Pentridge Prison, where an apartment development is being planned.

Bidding officially began at $3.8 million after a rejected $2.75 million starting bid, before stalling at $4.15 million. After some consultation, a vendor bid was placed at $4.5 million, which was matched by a bidder. The Coburg petrol station was secured at a 5.64% yield.

Next on the auction block was a Coles Express petrol station in Queensland's Ayr. Located about 85 kilometres south of Townsville, the Coles Express at 140-132 Edwards Street (Bruce Highway) on a corner site, the 2,015 square metre property came with development approval for a fast food outlet.

Coles Express pay $288,400 net per annum in rent, with fixed 3% annual rental increases.

Scholes suggested that bidders from Brisbane, Sydney and Melbourne begin at $4 million, and a small group of bidders slowly pushed the price upwards past $5 million. After a tight bidding volley between a Sydney and Melbourne bidder, the winning $5.1 million bid from a Sydney investor saw the Melbourne hopeful walk out of the room.

The Coles Express sold at a 5.65% yield.

The vendors of the next Queensland petrol station to be auctioned weren't quite so lucky.

The Shell SPAR Express in Bundaberg, at 15 Scotland Street, was passed in after subdued interest from the crowd.

The corner petrol station site, which includes a 378 square metre SPAR convenience supermarket, brings in $337,459 per annum in rent. The tenant has signed a 20 year lease to 2032, with a fixed rental increase of 4% per year.

While Scholes attempted to entice bidders to enter the race at $4.5 million, the first bid was placed at $4 million. After just a handful of bids, the bidding stalled around $4.5 million. It was passed in at $4,525,000.