Vendors celebrate as sales exceed expectations
A MIXED-use commercial investment with redevelopment potential (STCA) in central Newcastle has been sold at auction by Ray White Commercial Newcastle for $2 million – $600,000 above the reserve.
The two-level building at 39 Darby St, Newcastle, was sold under the hammer to a local investor by Ray White Commercial Newcastle’s Lee Follington and Barry Price of Ray White Newcastle Lake Macquarie on behalf of a private owner.
At the same in-room auction a boutique retail investment at 1/295 Darby St, Bar Beach, was sold to a local investor by Ray White Commercial Newcastle’s Lee Follington and Beau Russell for $1.275 million and a yield of 6.2%.
“The property at 39 Darby St drew strong interest from both local and Sydney investors and the sale price was a tremendous result for the vendor,” Mr Follington said.
“We were also delighted to sell 1/295 Darby St under the hammer.”
Ray White Commercial head of research Vanessa Rader said central Newcastle had experienced strong sales transactions during 2016.
“The prolonged low interest rate environment has resulted in a greater number of investors looking to secure holdings at attractive yields or with development potential,” Ms Rader said.
“There has been a push into regional markets over the last couple of years as affordability in metropolitan areas made returns unappealing.
“Prime assets currently range between 5% and 10%, depending on the lease covenant, however, on average 6.85% which is down 165 basis points over the last three years.”
Further inquiries to Mr Follington on 0417 443 478 or Ms Rader on 0432 652 115.