March 1 2022
1 Cahill Court, Burleigh Heads was sold via an off-market campaign which was distributed to the Kollosche database.
With such a high demand for freehold industrial properties, the site was sold within 48 hours of distribution. The property was contracted on a cash, unconditional basis.
Property Details
Address: 1 Cahill Court, Burleigh Heads Land Size: 1,219m2* Building Area: 600m2* Sale Price: $2,000,000
Sales Analysis
Passing Net Income: $70,000 Passing Net Return: 3.5% Land Rate/m2: $1,640 Building Rate/m2: $3,333/m2*
Currently there is a tight compression in the freehold industrial yields which can be attributed to the following key points;
• Industrial Rentals: Currently the market is going through a phase of high rental growth, therefore the low yields being achieved are generally taking into account the potential growth and ability to increase the income through future market reviews or asset repositioning.
• Vacant Possession Demand: The high demand for vacant possession industrial properties is driving the price growth in this sector. In general, a shortage in freehold sites presents an opportunity not only for a highly competitive selling environment, but also for favourable contract terms for vendors.
2022 will see continued growth in the industrial sector. With several industries who require industrial properties performing and set to continue performing extremely well, the demand for industrial properties will remain high throughout 2022.
How to Best Position Your Industrial Asset Within the Market:
• Increase the rental via market reviews
• Reposition the asset by capital improvements
• Strengthen the covenants by negotiating higher security through increased bonds, personal guarantees and several other methods which will protect your asset
If you would like any information around building your investment portfolio or would like assistance with your current commercial asset, please reach out to our Kollosche Commercial team for expert advice on any of your commercial real estate requirements.
