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The iconic George Hotel in South Melbourne has sold for $5.2 million, highlighting the ongoing demand for prominent investment opportunities in city-fringe locations.
A Chinese investor is the new owner of the 406sq m, two-level freehold building at 139 Cecil Street, securing the property at a sharp yield of 4.86 percent.
Savills Australia’s Nick Peden, Clinton Baxter, Jesse Radisich and Glenn Ye brokered the deal, saying more than 125 registered buyers made enquiries throughout the expressions-of-interest campaign.
“The sale of The George Hotel is a clear reflection of the hot demand for blue-chip investments within Melbourne’s most premium suburbs,” Mr Peden said.
“This result is evidence that buyers are flocking to A Grade commercial properties and are willing to accept tight yields due to the scarcity of opportunities and the long-term growth.”
Mr Baxter said Savills Asian Services found the buyer for the property.
“This highlights our capability within the market to reach a broader worldwide market, creating greater completion and ultimately achieving record prices.”
The George Hotel has been operating for more than 150 years and signed on for a further five years in January this year, plus renewal options, generating a total net rental amount of $253,146 per annum.
Mr Radisich said the buyer was drawn to the building’s strong income return, future upside potential and five-star South Melbourne location.
“With a Commercial 1 zoning, there is scope for exceptional redevelopment, while the unbelievable location opposite the South Melbourne Market ensures The George Hotel is the ultimate long-term investment.”