Hampton pharmacy sells on record low yield

A prime bayside Melbourne retail site has sold for a record result after hitting the market for the first time in 30 years.

The property at 323-325 Hampton St, Hampton, fetched $2.66 million at auction, setting a new benchmark yield of 2.6% for the area.

Sales in the Hampton precinct are extremely rare, with only two properties being offered in the past two decades.

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The chance to snap up a space in the beachside strip saw investors reach for their chequebooks, with five bidders vying for the site at the auction earlier this month.

The fully-tenanted property comprises of a 243sqm two-storey brick building, with Hampton Pharmacy occupying the ground level and office space on the first floor. Zoned Commercial 1, the site has a substantial 7.6m frontage and is located just a short walk from the Hampton train station.

Fitzroys agents Mark Talbot and Tom Fisher handled the campaign on behalf of the Read and Leung family, who operate the pharmacy onsite.

Retail properties on Hampton St are notoriously tightly held.

Talbot says property in the tightly-held bayside suburb is on investors’ watchlists due to its rarity and the growth potential.

“The area is attracting a younger demographic moving out of the affluent suburbs of Brighton and Beaumaris along the bay, catered for further by a number of medium and high-density residential projects in the immediate vicinity of the strip,” he says.

“Trading along Hampton St has been strengthened by the ongoing development around the area, including the Anchorage and Lido projects just metres away.

“The result demonstrates that investors retain a strong appetite for primely-positioned retail strip properties, located in areas offering healthy growth prospects.”

The long-term tenant Hampton Pharmacy has a renewed lease of three years with options that includes annual reviews.

It is complemented with a nearby car park.

Hampton has one of the Melbourne’s best-performing retail strips with vacancies tightening from 8.4% in 2017 to 5.6% last year, according to Fitzroys’ Walk the Strip report.

The area has numerous established eateries and well-known retailers including Commonwealth Bank, Flight Centre, Hampton Cycles, Australia Post and Bakers Delight.