While its residential real estate market may have been the darling of property investors in recent years, the head of one real estate agency believes another section of Sydney’s property market is set to shine.
Malcolm Gunning, principal of Gunning Real Estate, believes suburban commercial and retail properties in are soon to become the target of choice for investors in Sydney.
“These are not the fancy properties you see in the property sections, they are solid commercial and retail properties that give good return on investment,” Gunning said.
“We believe properties like this will continue to see a lot of attention throughout 2016 and believe this is a direct flow on from the changes to zoning and banks preference to lending more to commercial investors in particular for property within Sydney's 20km ring,” he said.
The zoning changes, which allow for greater mixed-use in areas that have traditionally been commercial or retail only, will provide investors greater returns and improved development options.
“These properties have been a sleeper in comparison to residential properties and their appeal has activated due to rezoning of areas like Rockdale, Kingsgrove, Revesby and Bankstown to B4 Mixed Use that allows retail, office and residential development. As a result sites have been amalgamated for ground floor retail business and upper level residential,” Gunning said.
“Buyers are looking for properties with a 4% yield and potential growth.”
Gunning said the areas such as Rockdale, Kingsgrove, Revesby and Bankstown are also proving popular thanks to transport links, both existing and future.
“These strips are in close proximity to the new improved public transport hubs and after the upgrade to the railway lines they are very desirable because the infrastructure is already in place.”
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