Alexandria warehouse sells $1 million over reserve at auction

Thirty-year-old Jason Li doubled his money on Saturday morning when his investment property sold for $3.01 million.  

The young property developer and his business partner bought the warehouse at 252 Mitchell Road in Alexandria two years ago for $1.45 million.

The sale price soared $1.01 million over reserve.

The auction, held on the pavement outside the commercially zoned property, was one of 371 auctions scheduled for Sydney on Saturday. This compares with 630 on the same weekend last year.

With 253 of the results in by Saturday evening, Domain Group put the clearance rate at 75.5 per cent – almost identical to last week’s 75.4 per cent. “Sydney’s mid-winter auction market remains strong as buyers compete feverishly for low numbers of listings with investor activity also on the rise,” Domain’s chief economist, Dr Andrew Wilson, said.

The Alexandria auction drew a crowd of 50. They were all decked out against the early morning chill in puffer jackets, scarves and beanies – except Mr Li who stood out in a sleek navy suit and matching Louis Vuitton leather satchel.

“It’s a good result,” said a smiling Mr Li after the auction. “My partner and I have worked in real estate and own our own company.”

The savvy pair has development projects across Sydney numbering more than 100 residences. They had initially planned to develop the site themselves, however circumstances changed said Mr Li.

“We had to give this property to someone else to develop,” he said not sounding at all disappointed, which is not surprising considering the outcome.

“I thought we’d get $2.2 million,” said Mr Li, “$2.5 million tops.”

Auctioneer Damien Cooley, of Cooley Auctioneers, said the reserve had been set at $2 million. “It’s an incredible result,” he said. “This city-fringe market, from a developer’s point of view, shows a huge upside.”

Interested parties had the option of various uses for the site. Zoning allowed the 285-square-metre property with rear-lane access onto Belmont Lane to increase its floor space to 570 square metres over several storeys.

Even so, selling agent Con Fotaras of Belle Property Surry Hills, was gob-smacked at the result.

“I don’t know what to say. We thought the reserve was quite high and even the price guide was a bit rich,” he admitted.

Ten groups of buyers turned up to the auction with six making bids. Four parties bid competitively in $100,000 and $50,000 increments.

“That showed that people saw the value. It wasn’t just two bidders taking it away,” he said.

Mr Cooley said all the developers who bid had pulled out of the action by $2.3 million.

The Erskineville buyer plans to leave the tenant, Sydney Tap and Bathroomware, who had also bid on the property, in place for the time being. She may develop it in the future, she said, or make it her home.