An opportunity has arisen for private investors and self-managed super funds to purchase the premises of a Bank of Melbourne retail outlet offering a potential yield of 6.8%.
The bank branch, located at 297 Wyndham Street in the Shepparton CBD is close to retail premises tenanted by Westpac, Commonwealth Bank, ANZ, Gloria Jeans and Rivers stores.
It is expected to fetch around $600,000.
Recently refurbished, the property is leased to The Bank of Melbourne at $40,979 per annum for five years with two further five year renewal options with fixed annual rent increases of 3%.
Zoned business 1, this property has a total land area of 270 square metres and building area of approximately 150 square metres including five metres of street frontage to Wyndham Street.
It is being marketed by Raoul Holderhead and Jamie Perlinger from Burgess Rawson.
Bank branches proved popular with investors last year with Burgess Rawson selling 12 of them on yields ranging from 5.75% to in excess of 8%.
Prices ranged from just $202,000 paid for a Bendigo Bank branch in Elmore on a yield of 6.6% to $5.9 million paid for the Commonwealth Bank branch in Balmain in inner Sydney, also on a yield of 6.6%.
“Banks have emerged from a period of rationalisation and are increasingly viewed as stable long term covenants that occupy prime retail locations,” says Burgess Rawson.
“Furthermore banks appear to be shoring up strategic locations and committing to longer lease terms.”
A less than two hour drive from Melbourne, Shepparton is located within The Goulburn Valley, which is known as the food bowl of Australia.
The property will be auctioned as part of the Burgess Rawson investment portfolio auction on February 27.