A private investor has paid $5.358 million on a 7 percent yield for Hobart’s only Freedom Furniture store.
A private investor has paid $5.358 million on a 7 percent yield for Hobart’s only Freedom Furniture store following an Expressions of Interest campaign managed by Savills with LJ Hooker.
The campaign for the strata-titled investment attracted 94 enquiries from local, interstate and off-shore interests, eventually selling to a local investor at a rate of $2,649 a square metre of GLA.
Occupying a prime location within the heart of the CBD at 80 Brisbane Street, the property comprises a 2,023 square metre, single level showroom with both basement and at-grade parking for 27 vehicles on a strata titled site of 2,904 square metres.
The sale comes as retail investments hit record levels nationally and the Tasmanian capital thrives amidst a circa $2 billion development boom which has seen the construction of new apartment buildings driven by a rapidly increasing population.
According to Savills Pat De Maria and Tom Forrest and LJ Hooker‘s Mark Devine, the property was sold subject to a 10 year lease (expiring 2022) to Freedom Furniture at an annual net income of approximately $376,000.
Mr De Maria said the sale presented a great opportunity to invest in Hobart at a time when the city was in the midst of one of the largest development booms in its history.
“The property could not have been placed on the market at a better time with Hobart in a rapidly evolving development phase which is providing exceptional growth potential for established retailers.
“Retail investment nationally is currently running at $6 billion to $7 billion a year, bolstered by a high level of off-shore investors - as well as local institutional and private investors - which has intensified competition and driven yield compression,” Mr De Maria said.
Mr Devine said Freedom Furniture benefitted from a large main trade area accommodating nearly 50,000 residents supplemented by an additional 163,000 people across Greater Hobart.
“The property’s strong catchment added further to its substantial investment credentials including its prime inner CBD location, the secure tenancy profile with a leading national retailer, the extensive street frontage, and on-site parking.
“The 94 enquiries reflected a strong and growing market for Tasmanian investments, especially retail, as Hobart and other key cities are bolstered by a surge in population including those priced out of mainland city residential markets,” Mr Devine said.
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