Premium inner Sydney portfolio listed for $120 million through Savills
Savills are set to list The Premium Inner City Portfolio, four premium high profile assets in Sydney's Chippendale, Darlinghurst and Ultimo.
The four commercial buildings, offered in one line or separately, have the income potential of around $10 million per annum when all fully leased.
The portfolio is dominated by space near Broadway, with two buildings in Chippendale and one bordering Chippendale and Ultimo.
The biggest is 55-59 Regent Street in Chippendale (main picture) which has 4,100 sqm of net lettable area (NLA) of office space on a 2.34 year weighted average lease expiry (WALE).
Nearby is 8-14 Broadway, currently The Posh Hotel (below), also comprises 320 sqm of NLA retail space. The Posh Hotel has 32 hotel rooms across four levels with a WALE of 4.25 years.
The building last sold for $3.41 million in 2006.
On the same street, but classed as Ultimo, is 137-145 Broadway (below).
The building has two levels of accomodation above a 550 sqm retail space on a 2.81 year WALE.
It last traded for $3 million in 2008.
The final piece of the portfolio is further afield in Darlinghurst (below), the smallest building which is currently the 16 room Sydney Boutique Hotel.
The building at 114 Darlinghurst Road has 190 sqm of ground floor retail.
It last sold for $5,715,000 in 2016.
Savills Australia's Tom Tuxworth, who is marketing the properties with David Hickey, Jordan Lee and Nick Lower, said beyond each asset’s outstanding location, the properties offer a strong diversified income stream.
“The portfolio lends itself to the opportunity to add value through repositioning, redevelopment and/or re-leasing as expiries arise capitalising on leasing demand strong market conditions”.
The Sydney City Fringe is an extremely tightly held market, with only two commercial assets trading thus far in 2019 over $15m.
“The significant investment into infrastructure with projects underway in Sydney's City Fringe such as; The Central station re-development, Sydney light rail & Sydney Metro will ensure better connectivity and amenity for tenants and occupiers, giving security of demand providing buyers with risk-averse investments.
Tuxworth said investors and owner-occupiers are drawn to the convenient nature of these locations and the surrounding premium amenity that it provides, resulting in excellent hotel occupancy rates and record high office rental returns coupled with sub 3.00% vacancy (Dec-18).
Recent projects, like Frasers Central Park has brought a new found retail activation and an abundance of amenity to the surrounding area.
“Despite some previous stigmas, the city fringe has established itself as one of Sydney’s fastest growing markets for high-rise developments and has seen extraordinary year on year rental and capital growth," Tuxworth said.
"For many years, the Sydney City Fringe has been a home for local investment groups, however, more recently has seen a strong following from buyers out of South East Asia and different parts of the Middle East and China.