Southern investors buy storage complexes in South Townsville, Railway Estate

After snapping up two storage facilities to kick start their investment portfolio, a Melbourne family has fallen in love with Townsville. See why they bought here.

Melbourne investor Mike Zarif has explained what led him to buy two Townsville self-storage facilities.

Townsville’s commercial properties are continuing to attract bargain hunting investors like Mike Zarif, who recently snapped two self-storage facilities to kick start a new business venture.

A product executive based in Melbourne, Mr Zarif said he and his wife Melissa had been searching for over six months for the right commercial investment opportunity to kick start their investment portfolio.

It was only after broadening their search wider to Townsville that he stumbled across the ideal opportunity – two self-storage facilities being sold by the same owner.

Located at 3 Tully Street, South Townsville, the first self-managed storage complex included 40 various sized storage units ranging from 2.8 sqm up to 24 sqm, which were fully tenanted

Generating over $43,000 in net income annually, it was being sold for $625,000.

View of the Tully St, South Townsville storage sheds, which recently sold for $625,000. Picture: Colliers.

Nearby at 134 Perkins St, Railway Estate, the second storage complex featured 24 individual storage units, which generated over $37,000 net income, and was being sold for $525,000.

“I thought it was a really good investment. I flew up in April and I put an offer shortly after, like, as soon as I saw it and I met everyone,” Mr Zarif said.

Investor Mike Zarif, with Shaun McLaren from Colliers (right) has purchased storage sheds at 3 Tully Street, as well as a nearby commercial property at 134 Perkins Street, Railway Estate.

“I sort of fell in love with the town and fell in love with the people, and it put any sort of anxiety at ease about buying something so far away.”

In addition to their yield, he liked the diversified nature of storage facilities, where rather than having one tenant, you had dozens.

“There’s obviously high demand for this sort of facility, for rentals in the area. There’s not enough supply,” he said.

View of the 134 Perkins St, Railway Estate storage sheds, which recently sold for $525,000. Picture: Colliers.

“My plans are to uplift the aesthetics … so I’ve rebranded it to my own brand (Store Secure), and then I’m going to upgrade the security, put in electric gates at CCTV, that sort of stuff.

A fan of the warm weather, and the “nice and clean” city, Mr Zarif could see a lot of potential for future investments in Townsville, especially given its large, fast-growing population.

“The opportunity for investment here is far greater. It’s really good value (compared to) Melbourne or Sydney, where you just can’t get in,” he said.

“There’s not enough supply of commercial properties, or good commercial properties, and it’s very expensive.”

After helping Mr Zarif secure the properties, Colliers sales executive Shaun McLaren said Townsville’s investment sales market remained very strong, despite the ongoing challenge of securing stock.

Investor Mike Zarif, with Shaun McLaren from Colliers (right) has purchased storage sheds at 3 Tully Street, as well as a nearby commercial property at 134 Perkins Street, Railway Estate.

“These storage sheds in South Townsville hit the market recently and had every good inquiry, so were sold very quickly,” he said.

“They are an ideal entry level investment property with multiple tenants so a bit of diversity of risk and also both sold at less than $1m which is ideal for the entry-level investor.”

Originally published as Southern investors buy storage complexes in South Townsville, Railway Estate