Cotton On today sold a Fairfield warehouse-despatch centre for $3.6 million.
The 1690 square metre office/factory, on an 1871 square metre corner site at 161 Perry Street (pictured top and below), traded to a private investor at an auction conducted by GrayJohnson’s Matt Hoath and Rory White.
This small pocket, six kilometres north east of the Melbourne CBD, is considered the inner north’s best commercial and light industrial precinct.
Prior to putting the investment on the market, Cotton On drafted a five year lease with renewal options, potentially seeing it stay until 2028.
Based on the net rent the occupier will pay upon sale settlement ($205,810), the Fairfield industrial asset is exchanging on a 5.6 per cent passing yield.
Established over 40 years ago in Geelong, Cotton on operates out of 77 national retail stores.
In July, we reported that its directors sold a North Geelong industrial site to interests associated with food distributor Bidfoods, banking about $3 million.
The Fairfield asset was considered “doubly important” to investors
Mr Hoath said he expected the property would sell for about $3.15 million “which would have indicated a yield in the order of 6.5 per cent’.
“Large sites with land area over 1000 sqm are rare so the offer of a corner property of this scale with a very strong new lease covenant made this opportunity doubly important for investors especially those with an interest in land banking for the future.
“The major arterial roads and transport linkages are a key attraction and there has been a marked increase in new occupiers from the hospitality, logistics and professional services sectors recently in reflection of this.
This particular property, Mr Hoath added, was ideally situated being just off Grange Road with almost direct access through to the nearby Eastern Freeway.
With a combined street frontage of 90 metres, 32 of which is to Perry Street, the Cotton On factory is configured with clear span warehousing accessed via multiple roller door points.