Entire Geelong apartment block sells after being passed in at mortgagees auction

Four bidders were locked in a drawn out mortgagees auction over an entire modern block of six apartments in central Geelong.

After nearly an hour of coaxing offers from the crowd, interspersed with private chats with the mortgagee and an additional financier, the four-storey complex at York St, Geelong, was passed in for $3.625m.

Colliers Geelong agent Jonathon Lumsden revealed the property was sold immediately after the auction to the buyer holding the highest bid.

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The property is set to provide the investor with a strong return, given the sub-$4m sale price doesn’t truly reflect the value of the property, given it was completed in 2023.

Mr Nanni said Geelong’s economic trajectory made it a more enticing opportunity for investors, with the nation’s second-fastest growing regional population, a regional gross domestic product up 152 per cent since 2008 and a strong labour market.

The property at Lots 1-6/13 York St, Geelong, was listed with ambitious $4.5m to $5m price hopes.

Auctioneer Chris Nanni had suggested a mid $3m start for the auction and even rebuffed a $2.8m bid from one buyer who clearly hoped to secure the complex completed in 2023 at a bargain price.

The apartment building at 13 York St, Geelong, was marketed with a $4.5m to $5m price guide.

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Mr Nanni said he’d been instructed not to take any bids below $3m.

Eventually the phone bidder got the auction under way with a $3m offer, but attempts to advance the bids by $100,000 were ignored.

Mr Nanni said the potential rental yield remained close to 7 per cent as the price advanced to $3.6m, with the initial phone bidder holding the highest bid when the auction closed.

Another party, which inspected the property just prior to the auction, didn’t make a bid.

Planning permission for the development emerged in 2017, which created six subdivided lots containing the modern apartments.

The project was completed in 2023, meaning the new owner can claim the depreciation available from the early years of the building.

The location, close to Deakin University and central Geelong, was a key reason to invest in Geelong, auctioneer Chris Nanni said.

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The property delivers a gross rental income of $243,000, with strata approval giving new owners the opportunity, should they choose to go down that path, of selling off the apartments individually.

The apartments are a combination of two and four-bedroom residences offering executive-style living.

The two-storey, four-bedroom penthouse apartments also offer an outdoor terrace surrounding the main living zone and a balcony outside the main bedroom. Windows have double-glazing throughout the development.

The property has secure off-street parking for eight vehicles.

The building is located just off an seven-lane section the main arterial road through central Geelong, offering occupants in upper level residences water views over Corio Bay, with other vantages overlooking the city skyline and Geelong West.