Perth investors have paid $9.5 million for a 20 year old Gold Coast office.
The five-storey building, 128 Bundall Road, Bundall, was offered by Newallah Pty Ltd, an entity linked to the Hams family.
A a rental guarantee covered a four per cent vacancy.
The sale price reflects a fully let 8.15 per cent yield.
With 2984 square metres of lettable area and 66 car parks, it is a five minute drive to Surfers Paradise.
Major tenants include Walker, RSL Queensland and Patersons.
Another, Wahlstron Financial Services, has naming rights.
The passing annual income is $770,000.
The deal comes five months after Newallah sold a nearby office, 7-11 Short St, Southport, with 2533 sqm of area, for $8.2m.
“The sale of 128 Bundall Rd is an incredible run for the street,” Mr King said.
“In fact, three adjoining office buildings have now sold for a combined value of $35m in just over two years.
“The lack of opportunities currently in the market and the value this building presented led to the expressions of interest campaign generating 89 enquiries from a mix of domestic and interstate investors.
“We received six offers, with the highest one coming from an interstate investor,” the broker said, adding of the Bundall property “prices are substantially higher in other states so they are willing to compete with locals on price”.
Mr Crawford added with debt cost at record lows, “yields have continued to compress in the capital cities resulting in buyers looking further afield for stronger returns”.
“As Australia’s sixth largest city, Gold Coast offers investors strong property fundamentals, limited new supply and yields ranging between seven and eight per cent.
“The outlook for 2020 is a positive one with transaction volumes expected to be up in the first half, and yield compression is likely as buyers compete for secure returns”.
The 128 Bundall Rd purchaser, according to Gold Coast Bulletin, is Property Bank Australia owners Sandy and Gus MacKellar and Chris Glass.