Balgowlah property sells on 4.56% yield

A mixed-use retail and residential property in Sydney's north has sold at auction for $2.63 million. A private investor acquired the property on an initial 4.56% yield.

Located at 393-399 Sydney Road in Balgowlah, the property comprises four ground floor retail shops, three first floor apartments and a three bedroom cottage on an adjoining parcel of land.

The two storey building occupies a 983 sqm site and has a 27 metre frontage.

The property is fully leased with all tenants on expired or monthly leases. The combined current net income is $120,000 net per annum.

The four shops house a fashion retailer, a gift shop, a jeweller and a real estate agency. The buyer is believed to planning to upgrade the property and negotiate new lease terms with the existing tenants.

The property is situated in the centre of Balgowlah and opposite the soon to be completed Totem Shopping Centre, said selling agent Robert Klaric of Klaric Partners.

"The shopping centre is due to be completed in 18 months and was the main drawcard of the property," he said.

Strong demand pushed the price to over $150,000 above the set reserve, with the vendor set to reinvest the proceeds of the sale into an IT business.