This week we take our annual departure from the mainstream to investigate more unique commercial opportunities for investors and occupiers. From a decommissioned substation to a boutique wilderness lodge or iconic pub featured in the movie Mad Max, a perusal of listings and sales reveals dozens of properties and businesses with something different to offer – whether that be a new lifestyle, a way to diversify and boost an existing portfolio, or an option for a new entrant to the property market.
As with any commercial purchase, agents strongly advise prospective buyers perform their own due diligence and seek expert knowledge around asset classes with which they have no experience. The appeal however of both more unusual and mainstream commercial assets is that despite their complexity, the potential is high for them to produce better returns than possible with residential.
Renewing the old
Raine and Horne director of projects James Nixon sold one of the most unique commercial properties on the market in Sydney last year when he auctioned a decommissioned substation being offloaded by Ausgrid. The 1062 sqm property with a heritage-listed building at 3-5 The Avenue Rose Bay went well over its $3 million-$3.3 million price guide when it sold under the hammer for $7.315 million after a month-long campaign. Comprising a circa 1900s building adjacent vacant land suitable for development, the property was hotly contested despite presenting the challenge of having to remove all the original plant and equipment. “It was just completely vacant,” Mr Nixon said. “Just the equipment was sitting in there and it was sold as is. But it was unusual because it sat on significant land and I realised someone super creative would come along and buy it.”
Eventually they did, in the form of an architect who could see the potential to transform the solid brick building with its attractive heritage façade into a modern office and eventually build apartments on the vacant land.
“Now from the back of that sale we have the neighbouring property (1 The Avenue; 443 - 445 Old South Head Road; 439 - 441 Old South Head Road, Rose Bay) on the market,” Mr Nixon said. “It has an 1800 sqm block with 12 apartments, a panel beater baker and two gym plus it’s opposite the golf course and a great investment returning $700,000 per year.
“One thing that really does stand out to me is it always takes a creative person to come along to buy these kinds of properties as they end up unlocking extremely good value just by looking outside of the box.”
Far from Sydney’s eastern suburbs, there is the chance to become the owner of the character-laden Silverton Hotel. The famous pub featured in films including Mad Max and Priscilla Queen of the Dessert is on the market for $3.25 million. As one of the outback’s main tourism hotspots, the Silverton Hotel draws about 120,000 tourists a year and serves over 1000 meals a week. It is advertised by Resortbrokers as being “suitable for first-time operators looking to enter into the accommodation industry or experienced operators” and returns a high net $310,000.
Far and away
Much further north, the boutique Bloomfield Wilderness Lodge nestling on the tip of Queensland is on the market with Stacey Quaid from Colliers. Once hailed by Forbes magazine as the “world’s best remote hotel” it has been closed for just over two years and looked after by caretakers. The 3.73ha listing, Lot 102 Esplanade Cape Tribulation Queensland, it located on the shores of historic Weary Bay near the Great Barrier Reef. There are 17 private guest suites, an alfresco style restaurant and bar, large swimming pool and a fitness centre. The listing falls under multiple categories - rural, farming, hotel, motel, pub and leisure – and comes with helipads, an airstrip and wharf. It is for sale by formal offer.
In Sydney’s prestigious inner-city suburb of Paddington, there comes the chance to own an ideal work from home-style premises. The iconic Paddington shopfront at 22 Oxford Street Paddington has a heritage façade fronting a luxurious high-end two-bedroom residence and business area with three offices and is spread over two levels. It is for sale by owner at 22 Oxford St, Paddington, NSW 2021 - For Sale - Other - ID: 423110 (commercialpropertyguide.com.au)