146-154 York Street, Sale
A longstanding government building in Sale has been sold for $11.6M and a razor sharp 5.4% for regional Victoria, after almost 30 years of tenure with both the State and Federal Government.
Stonebridge Property Group’s Rorey James, Kevin Tong and Justin Dowers handled the Public Expression of Interest campaign, signalling that the result far exceeded all expectations and confirmed the strategic timing to offer the asset.
The property was sold to an international Chinese investor, the second time this has happened this year, after the Spotlight building sold earlier this year to a buyer from the same origin, also sold by Stonebridge.
Leased the Department of Health and Human Services (DHHS) and Services Australia (Centrelink), the property was sold with a short WALE of 3.6 years, further highlighting the result achieved.
Despite the past 2 regional Victorian Centrelink’s trading for yields of 7.74% (Ararat) and 8.77% (Hamilton), the yield achieved for Sale was more than 200 basis points sharper at 5.45%, with the shorter WALE and higher price point not deterring investors chasing a secure income stream, according to Stonebridge.
“With a continued flight to quality from buyers towards safe haven investments, the ‘Gov Hub’ building received strong attention from local, interstate and some international markets, evidenced by the eventual sale price and the numerous underbidders who missed out on the opportunity.”
Leading fund manager Castlerock has been acting on behalf of the vendor, with Castlerock CEO Hank Bronts saying, “We are thrilled to have achieved such a strong result for local investors.”
Regional Victoria continues to be sought after by investors looking to capitalise on the 50% stamp duty concessions together with the growth coming from these core regional hubs, with Stonebridge having sold more than $150m of regional investments in 2021 alone from 19 transactions.