Melbourne dental clinic a potential ‘free business’ in seven years
A Pascoe Vale dental facility that will appeal to both investors and future owner-occupiers alike is to be auctioned later this month.
The property at 269-271 Gaffney St is being put to market at a time when investors are leaning heavily towards medical assets due to their long-term security.
It is leased to the Pascoe Vale Dental Group, which was recently acquired by industry heavyweight Bupa Healthcare and has been established in the area for more than 40 years.
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The property will be put on the block at Burgess Rawson’s next Portfolio Auction at Crown Casino on Wednesday, October 30.
It is expected to sell for circa $3.1 million, which would represent a yield of around 5%.
While the asset will appeal to investors, Burgess Rawson director Raoul Holderhead says it will also be attractive to owner-occupiers and dental operators, as its current lease ends in 2022.
“It’s going to appeal to owner-occupiers. There’s a lease until 2022 with a five-year option, but after that it’s potentially open slather,” Holderhead says.
The prime corner site in Pascoe Vale.
“A passive investor could buy this and enjoy the income and likely have a new lease in seven years’ time, or an owner-occupier could come along and effectively acquire a business for free in seven years’ time.”
“If there are any dental practices that are looking for an opportunity that’s going to come around quickly in an established centre, there’s no better location.”
The property, constructed in 2007, presents as new and features a 320sqm building on a 1136sqm site with 65 metres of street frontage and 19 on-site car spaces.
It currently returns a net annual income of $151,343 plus GST, with annual rent reviews.
Holderhead says Pascoe Vale, in Melbourne’s north, is enjoying a golden period of growth and development.
“The whole area has been improved with the Coburg North Village shopping centre, which is anchored by Coles, and just beside that is the Lincoln Mills Homemaker Centre,” he says.
Burgess Rawson’s 132ndPortfolio Auction will be held in the River Room at Crown Casino at 12pm on Wednesday, October 30.
