A Toorak Village retail property has sold for $4.55m on a record-low 1.5 per cent yield.
A mystery investor has defied high interest rates to splash $4.55m on a Toorak Village shop on a “razor-thin” 1.5 per cent return, the lowest ever recorded on the elite strip.
The 1.5 per cent yield would barely cover interest repayments for most borrowers, highlighting just how aggressively investors are backing Toorak’s long-term upside.
The property at 456-460 Toorak Rd comprises two retail buildings with 287sq m of floor space on a 354sq m site, with an 11.5-metre frontage.
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It is leased to Flawless Rejuvenation and Suzie Mcintosh Brows, with leases set to expire in late 2027.
Fitzroys agent Mark Talbot said the buyer was focused on future growth rather than immediate returns.
“We sold this to a local investor backing future growth in the area and rising rents,” Mr Talbot said.
“This record-breaking sale reflects the huge confidence investors have in Toorak Village.”
The deal comes as interest rates remain elevated, making the ultra-low return even more striking.
The tightly held Toorak Rd strip continues to attract strong investor demand. Picture: NCA NewsWire / Andrew Henshaw
Fitzroys agent Lewis Waddell said the low yield also reflected upside built into the asset.
“With leases coming up for renewal next year, you could argue the rents are under market value at the moment,” Mr Waddell said.
“That gives an incoming buyer the opportunity to reposition the asset and improve returns.”
The site sits opposite the Saint Germain development and near the Toorak Village residential project and future One Toorak Place, placing it in a pocket undergoing rapid change.
The property sits within one of Melbourne’s most exclusive retail precincts.
Mr Waddell said planning reforms were expected to further support growth in the strip.
“The Activity Centre initiative is projected to boost the existing established and affluent catchment and further support trade and activity along Toorak Village,” he said.
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