There was good local interest from Warrnambool and the Western District but it was a Melbourne purchaser who was the successful bidder.
- Jamie Perlinger
A MELBOURNE investor has paid $1.76 million for a prime piece of commercial real estate in Warrnambool.
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Burgess Rawson director Jamie Perlinger said the city offered good long term growth for investors.
The Fairy Street property is leased by Tradelink and offers a 6.6 per cent yield.
"People are looking for security," Mr Perlinger said.
"The yield is probably a little bit higher in regional cities versus metro Melbourne but what investors are really looking for is good long-term growth and Warrnambool offers that."
Mr Perlinger, said the property was sold in conjunction with Mark Dwyer and Nigel Kol from Ludeman Real Estate.
"There were four or five bidders on the day," Mr Perlinger said.
"There was good local interest from Warrnambool and the Western District but it was a Melbourne purchaser who was the successful bidder." Mr Perlinger said there was a lot of interest from Melbourne investors in strong regional cities. "It's a very strong regional city that people are keen to invest in," he said. The property offers a 1983-square-metre parcel of land and includes an 825-square metre building.
It is zoned Commercial-1 and offers a return of almost $121,000 per annum in rent.
It has a five-year lease with option to 2027.
"Warrnambool is Victoria's largest coastal city out of Port Phillip Bay, with a trade catchment of more than 100,000 residents that continues to grow every year," Mr Perlinger said.
"Investors are just starting to realise just how strong the market is down here.
Mr Perlinger said the sale was the third successful auction of a commercial building for Burgess Rawson in 2019.
The ANZ building on Liebig Street sold for $1.75 million while the corner building at 136-140 Fairy Street, which is leased to National Pharmacies, sold for $3.71 million.
Another Warrnambool commercial property will be auctioned by Ludeman Real Estate next month.
The 600-square-metre shed at 1127-1131 Raglan Parade is set to go to auction on Friday, June 14.
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