19/10/2012 - Bonus in busway uncertainty
A multi-tenanted commercial building on Brisbane’s northside along the proposed route of the fourth and final stage of the Northern Busway has changed hands for $2.13 million.
The property at 538 Gympie Rd, Kedron, was snapped up by a Brisbane-based private investor.
It lies along the busway’s planned final stretch connecting Kedron to Bracken Ridge, which reportedly is facing Premier Campbell Newman’s cost-cutting axe and may be scrapped.
Trent Bruce from Raine & Horne Commercial, who negotiated the deal, said he fielded between 30 and 40 inquiries, mostly from investors, but also a handful of developers and owner-occupiers.
He said the property had been facing potential resumption under the initial busway plans, but that had since changed and only a ‘‘minor setback’’ was now earmarked for the front of the corner site.
‘‘The proposed Northern Busway, which may or may not happen in the future, did cause a number of potential investors serious concern,’’ Mr Bruce said.
‘‘It resulted in a number of investors shying away from it and pulling the pin immediately. ‘‘So that’s probably had a bit of a softening effect in terms of the sale price without question I would say. Nevertheless, it still attracted a pretty strong level of interest.’’ Mr Bruce said the new owner had been looking around for an addition to his portfolio that offered some potential upside for future growth.
‘‘In neighbouring Chermside there’s potential for up to 15 stories and while Kedron is yet to be rezoned, you’d think in the not too distant future that will occur,’’ he said. ”The Airport Link entrance tunnel is only about a kilometre away from this site so it’s in a pretty prime position for future growth.’’
The building was purpose built in 1996 for the National Bank, which vacated the property in 2001. It was subsequently split into four separate tenancies with 485sqm of net lettable area on 1,703sqm parcel of land with onsite car parking for 20-plus vehicles.
The Kedron property was sold fully-leased, including new five-year commitments secured with two of its existing tenants, Simplicity Funerals and National Hearing. Its four tenancies return a total rental income of $190,000 a year plus GST and outgoings.
‘‘There is a true shortage of quality investments in the market,’’ Mr Bruce said. ‘‘With the interest rate environment we’re in we are seeing some more inquiries coming through from potential buyers, but there is definitely a lack of quality investment stock.’’