Two incomes on one title
Strong leases make for an attractive buy
A SWEET opportunity with views to match is on offer on the Cairns Esplanade.
Knight Frank has listed 4/95-105 Esplanade in the Trilogy complex for $1.8 million with a return of $139,000 net from two leases.
Senior commercial agent John Lynch says investors would do well to add the Esplanade strip to their portfolio.
“It ticks quite a few boxes. Position-wise, it’s hard to beat,” he said. “It’s got a brand new five-year lease with Anglicare, which we’d regard as a blue chip tenant.
“The other tenant is a company called Blue Gum, a travel agency whose parent company is based in New Zealand.”
Blue Gum has a lease until March 2024.
“Both tenants have separate tenancies, but are on the one title,” Mr Lynch said. “We think it’s going to be very attractive for investors. Even though times are tough, people are still looking for well-positioned property with strong leases.”
Mr Lynch said Anglicare operated the Movenpick icecreamery, sandwich and juice parlour and had taken over the original lease from Nestle.
“It would enjoy high foot traffic and is surrounded by high-rise accommodation,” he said.
The property was officially listed about six weeks ago.
“There’s a surprising amount of interest. Some has been from local investors, but the majority has been from southern investors, traditionally out of Melbourne,” Mr Lynch said.
“I don’t think it’s going to be on the market for long. It’s competitively priced and if we can provide something as good as that property, returning double what they’re looking at in Melbourne or Sydney, it makes it very attractive.
“They’re buying good stuff in Sydney or Melbourne at three and four per cent return. I believe somebody could buy this property and get about 7.5 per cent return.”