Investors driving sub-$2million commercial property markets in Brisbane

Media release - 27th October, 2015 

Volatile share markets and poor cash returns are pushing investors and self-managed superfunds into Brisbane commercial properties priced from $1 - $2 million.

“Sales to investors are strong in Brisbane’s south with the price range between $1 million and $2 million proving the sweet spot for investors and self-managed funds,” said Joseph Grasso, Principal of Raine & Horne Commercial Brisbane Southside.

To illustrate, Raine & Horne Commercial Brisbane Southside recently sold 806 Beaudesert Road, Coopers Plains for $1,012,000 to a partnership of two private investors.

The property has been home to a Goodyear franchise since 2004, with the firm recently committing to a new five-year lease. The lease is worth $67,000 a year, and comes with a six-month bank guarantee.

“This property clearly ticked many boxes given the credibility of the tenant and the length of the lease, while it’s a tilt slab building on a main road, with two-street access,” said Mr Grasso.

“The only negative was some minor flood damage, caused when the Brisbane River flooded in 2011.”

“We had 96 enquiries, 22 registered bidders at auction, and 4 offers prior to the auction. The property sold under the hammer for a yield of 6.6% net and for $112,000 above the reserve of $900,000. The seller would have been happy just achieving the reserve, so this is an excellent result.”

The sale underlines that demand for properties priced between $1 million and $2 million is robust, particularly with the stock market spluttering and low interest rates delivering only 2% returns for cash accounts, according to Mr Grasso.

–ENDS–

For further media information contact:

Joseph Grasso, Principal, Raine & Horne Commercial Brisbane Southside on 0418 789 080

Andrew Harrington, National Communications Manager, Raine & Horne on 02 9258 5400