Strata And Sell Plan For Arcade
Sydney Morning Herald
Tuesday January 31, 1995
Double Bay's Royal Arcade will be strata-titled and sold off by new owner, the Clubb Group of Companies, under a proposal which could net more than $7 million.
The high-profile shop and office complex was bought last year from Mercantile Mutual, which inherited the arcade from its 1992 takeover of the Occidental and Regal life insurance companies.
As part of a disposal of its smaller assets, Mercantile Mutual advertised the property for auction, but negotiated a sale a week previously with the Clubb Group, headed by the property trader Mr Andrew Clubb.
The purchase was a strategic move for the group, which is awaiting final approval of a strata plan dividing the New South Head Road property into 19 ground-floor shops and 12 first-floor office suites.
A successful sale of the individual suites and shops is expected to net $7.6 million, well in excess of the $4.8 million purchase price.
There have been few strata-title developments in Double Bay, which will favour the Royal Arcade plan, according to the marketing agent, Mr Phillip Kyle, of Laing & Simmons Commercial.
Marketing is expected to start next month, but interest from existing tenants has already been strong, particularly for the office component. "The office inquiry has been extremely encouraging because of the lack of good quality office space in Double Bay," Mr Kyle said.
Interest had been lodged in more than 60 per cent of the office suites, which ranged in price from $95,000 for a suite leased to Sally Ann Bendt Beauty to $430,000 for a suite leased to Drs Polyblank and Hodge. The only two vacant suites will be marketed as a package, for $150,000.
The real test of the market is expected to be the higher priced retail component.
Directions clothing store is the most expensive offering at $895,000, followed by Bugatti at $550,000 and Lesley McKay's children's bookshop at $475,000.
Shops not fronting New South Head range in price from $95,000 for the only vacant store.
Mr Kyle said yields averaged 6 per cent for the retail component to between 8 per cent and 10 per cent for the office component.
Marketing will be co-ordinated by Laing & Simmons and Bradfield & Prichard.
© 1995 Sydney Morning Herald
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