A private family has sold Officeworks Hobart to an investor from mainland China for $11,725,000 at auction.

The sale was negotiated by CBRE’s Victorian Freestanding Investments team of Joseph Du Rieu, Kevin Tong and Mark Wizel at its latest Premium Property Portfolio Auction.

Located on the fringe of the Hobart CBD, 105-109 Campbell Street is a freestanding 2,785sqm property occupying a landholding of circa 3,236sqm.

According to Mr Du Rieu, the limited supply of investment grade retail properties on the market is leading to further yield compression for investments leased to national tenants. 

“With the current environment characterised by a lack of premium, retail investment offerings, we are seeing increased demand for assets located in outer metropolitan areas which are experiencing population growth, especially in markets such as Hobart,” Mr Du Rieu said.

The property generated interest from both domestic and international investors and attracted multiple bids, resulting in a sale yield of 6.2%.

Mr Tong said; “The result indicates that yields have continued to sharpen for retail investment properties, particularly those which have a significant underlying land holding.” 

He added that the sale highlighted continued offshore buyer demand for retail assets and a broadening in focus from residential to commercial investment opportunities.

Officeworks recently renewed a five-year lease on the property, providing an annual income of $725,000. 

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