Asian investor pays $1.45m for retail premises in Fender Katsalidis-designed Hero building on Little Collins Street
An Asian investor has paid $1.45 million at auction for the premises of a jewellery store on the ground floor of the Fender Katsalidis-designed Hero building on Little Collins Street.
The sale price equated to a yield of 6.2% for the 50-square-metre retail shop at 144 Little Collins Street, leased to Pilkington Jeweller on a monthly lease.
The property was marketed for auction by Josh Rutman, Ed Wright and Mark Wizel of CBRE City Sales on Friday March 22.
The Hero apartment building is the former 1948-built Russell Street Telephone and Exchange Post Office building, which was transformed into inner-city apartments above retail by Fender Katsalidis with the addition of six floors, added in 2001.
It is considered one of the best examples of the transformation of a former public building into inner-city apartments.
Rutman tells Property Observer the auction drew over 150 spectators, with five genuine bidders pushing the property from an opening bid of $1,000,000 all the way to the final sale price of $1,450,000.
"This reflected a yield of 6.2% and an exceptionally strong rate of $29,000 per square metre over building area, a record for the building," Rutman says.
"This is the second sale of a retail investment property by CBRE City Sales this week and highlights the continued investor demand for well-located ground floor CBD retail properties.
"Despite negative commentary about the state of the retail climate these properties continue to achieve premium prices when marketed strategically by an agent to the marketplace," says Rutman.
CBRE City Sales also sold the 75-square-metre premises of Trend Cafe at 377 King Street for $900,000 at a yield of 6.5%.
"Investor demand for well-located retail continues to remain strong which is being mainly driven by the low interest rate environment and improved sentiment levels due to the improved residential property and share markets," says Rutman.