Georgian Hobart tavern sells for $7.8 million at auction

An 1830's Georgian property in Hobart has fetched $7.8 million at auction, well above the reserve price, through Knight Frank.

The three-story sandstone property at 21-23 Salamanca Place is close to Hobart’s popular Salamanca Markets, as well as the upcoming Parliament Square, currently in development, which is set to become the heart of Hobart.

“The Hobart investment market is as strong as we have experienced historically... yields are now breaking below six per cent consistently, with this property receiving the lowest yield on record to our knowledge for an investment property in Tasmania," said Scott Newton, chief executive officer, Knight Frank Tasmania.

Total net annual rent is estimated at $271,206, and the yield works out to be 3.47 percent.

The ground floor is tenanted by Irish Murphy’s tavern, with the upper two levels consisting of renovated offices. On the third floor is the ‘Salamanca Loft’, a refurbished two-bedroom unit featuring painted sandstone walls, two skylights in the lounge and a glass atrium. The apartment is utilised to accommodate tourists.

"Irish Murphy's" tenancy lease runs until July 2019 with a further five-year option. Current rent is $213,932 plus GST, plus outgoings.

Parliament Square will comprise a mix of office, hotel and retail spaces, with heritage buildings surrounding it expected to be restored. This will only add to value for 21-23 Salamanca Place.