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Investing In Commercial Real Estate - Retail Properties

Investing In Commercial Real Estate - Retail Properties

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Investing In Commercial Real Estate - Retail Properties

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  1. INVESTING IN COMMERCIAL REAL ESTATE - RETAIL PROPERTIES ~ By Gorman Kelly

  2. About Us We are Commercial Real Estate Agents and Brokers in Melbourne. GormanKelly specialises in helping private clients make the most of their Melbourne commercial property investments. We do this by providing a level of service, local knowledge and expertise that are unparalleled and by carefully nurturing long term relationships with our clients and local community.Whether you are looking to manage, lease or sell your commercial property, our approach is always the same. We aim to excel in every detail of the process, and be a joy to deal with.

  3. Investing In Commercial Real Estate - Retail Properties There has been plenty of focus on the performance of retail in the media of late, with varying outlooks ranging from doom and gloom to sunny promise. There is no denying the economic circumstances globally are pretty grim with no quick solution apparent. So, does retail property still make a sound investment in suburban Melbourne?

  4. Investing In Commercial Real Estate - Retail Properties RETAIL RETURNS Back in 2010 we saw investors clamouring to purchase in popular retail strips on yields as low as 2%. Today, you can expect a more respectable return of circa 4-5% (depending on location, lease terms etc), ideally with a short to medium term upside. With the availability of non-recourse debt and arbitrage on low interest rates, the conditions for buying are the best in years.

  5. Investing In Commercial Real Estate - Retail Properties WHAT TO LOOK FOR Typically strong performing retail strips have access to plenty of car parking and/ or are underpinned by great access to rail. Alternatively, the development of medium density residential apartments with ground floor retail can reduce this need and assist to enhance the vibrancy of our retail strips as the community that lives within the strip supports it. To ensure sound investment, make sure the rental is in line with true market levels. Inflated rents are unsustainable and could mean, in some instances, a dramatic reduction in return upon any impending market review. It is also important to ensure the Lease allows for appropriate security and/ or guarantees, just in case the tenant does default.

  6. Investing In Commercial Real Estate - Retail Properties COMMERCIAL IS COMPLEX When setting your budget, you need to consider the implications of Stamp Duty and GST. When you buy Victorian commercial property you are liable to pay duty. The duty payable is based on the market value of the property or the GST inclusive purchase price, whichever is greater. To obtain current duty rates visit the website of the Victorian State Revenue Office. GST may be payable on the sale price depending on a number of factors including whether the property is sold vacant or as a going concern, whether the vendor and/or purchaser are registered for GST and what the contract of sale specifies. Check the relevant legislation and ensure that the terms of the Contract of Commercial Property Sale Melbourne are clear with respect to the application of GST to the sale price and who will pay any GST, if applicable.

  7. Investing In Commercial Real Estate - Retail Properties COMPARABLE RECENT SALES/ LEASING EVIDENCE Buying commercial property is complex, you can’t be a generalist. Each suburb and retail strip within it performs differently to the next. For example Bridge Road, Richmond has been heavily hit by vacancies yet Swan Street, Richmond is doing very well.

  8. Contact Us Head Office Level 1, 1 Oxley Rd, Hawthorn VIC 3122 (entry via James Street) Email: reception@gormankelly.com.au Tel : (03) 9810 7200 Fax: (03) 9810 7299 Website: https://www.gormankelly.com.au Social Links:

  9. Thank You