Investors have earmarked beachside suburbs as offering the best growth potential, not just for residential, but commercial and mixed-use developments.
Last September, at a spirited auction, developer Allen Linz's Rebel Property Group, Capit.el Group's Eduard Litver and Gil Baron fought off a group of bidders to snare the former Bates milk bar at Bondi Beach, for about $19.12 million.
![Colliers International is selling 134-138 Campbell Parade at Bondi Beach on behalf of a private investor.](http://web.archive.org./web/20170723161946im_/https://www.fairfaxstatic.com.au/content/dam/images/g/x/a/t/y/d/image.related.articleLeadwide.620x349.gxatw1.png/1499939825898.jpg)
Pub operators have also flocked to the seaside with a number of leaseholds and freeholds being snapped up. Solotel moved into the Clovelly Hotel, while Justin Hemmes is in Randwick.
The fringe office markets are also buoyant. According to Colliers International, fringe markets continue to be most popular, and effective rental growth in these markets highlights this.
Sydney's CBD fringe was the fastest growing market in the country, with effective rents growing 30.7 per cent over the year to March 2017. Melbourne's city fringe also grew by a healthy 22.7 per cent over the same period.
Colliers International, which advised in the Bates sale, is now selling 134-138 Campbell Parade at Bondi Beach, which has a land area of 417 square metres and a net income of more than $500,000 a year. Market suggestions are that the price expectations are about $20 million, but the agents declined to comment.
The property will be offered through Miron Solomons and Matt Pontey of Colliers International on behalf of a private investor.
"We are expecting this to be the biggest auction of the year – there will be some serious heavy hitters present," Mr Solomons, the director of investment services at Colliers International, said.
"It's a once-in-a-lifetime opportunity – three buildings in this location, on the Bondi beachfront with uninterrupted views – coming to market within 12 months is unheard of. These assets are typically held by local families for 50 to 60 years each."
This sale comes to market following two successful campaigns of neighbouring assets: Bates Milk Bar at 124 Campbell Parade in September 2016, and 128-132 Campbell Parade in May this year, with the latter breaking the Australian record for the highest price paid per square metre for land.
Matt Pontey, the senior executive of Sydney metropolitan sales at Colliers International, said he was expecting significant international interest for the property.
"This asset will be hotly contested by developers and investors, not only due to the location, but also the flexible mixed-use zoning and a favourable lease term providing the potential for future mixed-use development," Mr Pontey said.
"There are also two exceptional retail tenancies currently placed within the building. The ground floor tenants are Ben and Jerry's and Ezymart, plus eight residential units above."
Mr Pontey said the tenants offered "solid, diverse income streams".
Mr Solomons said the interest in the past two Bondi sites indicated there was still plenty of appetite for Sydney's top-end "trophy" market.
"Capital growth from assets like Campbell Parade means that investors are able to compete aggressively at sharp yields, beyond market norms, to acquire once-in-a-lifetime investments," he said.