The sale price reflected a sharp 3.5% yield and land rate of $24,826 per sqm. It also came in well above the campaign expectations of $6.7 million-plus, and reflected a price uplift of more than $1.050 million since the property last sold in 2019, also through Fitzroys.

NAB, which has been at the site for 30 years, has renewed its lease over the strong-performing branch with 5+5+5-year lease that brings a strong income of $254,616 per plus outgoings including land tax.

The property is on a substantial site area of 288sqm with a large 8.5-metre frontage to the prime of the strip.

“This was undoubtedly one of the best Melbourne shopping strip investment opportunities we’ll see for 2023, and the result reflected that,” Talbot said. “The market recognised how rare it is to find a good-sized property with a renewed, secure lease to a major bank in the prime of Melbourne’s best-performing shopping strip.”

Talbot said a local investor was the purchaser, winning out from multiple bidders sourced from Fitzroys’ Asian database. Close to 100 enquiries were received, with most coming from Melbourne and New South Wales.

“The purchaser was attracted to the excellent tenant, the tenant’s payment of land tax and the strong rental growth achieved from the asset. There had been a 19% uplift in rental since the property was last sold four years ago, despite COVID resetting the world economy in this time. The benefit of land tax being recoverable from the tenant was a huge attraction to investors, and together with the secure lease-term to an ASX-listed big four bank made this investment close to risk-free.”

“We’re still seeing investors put their faith in income-producing bricks-and-mortar assets. Higher interest rates clearly haven’t deterred investors from pursuing high-quality opportunities.”