A retail parade in Newcastle’s historic Grainger Town has been snapped up by London commercial property specialists in a £1.6million deal.

Sisu Advisors Ltd has opted for the town center investment property at 68–82 Grainger Street in a deal overseen by property consultancy Avison Young.

The property comprises four ground floor retail units and a basement bar, located in the Grade II listed Georgian building with frontage to Grainger Street and Bigg Market.

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The property is held under a 999 year lease from January 2005 and has 10,706 square feet of space.

Tenants include Grainger News Ltd and Vaulkhard Leisure, which runs its popular Mushroom Bar basement bar in the building, which was sold to its new owners by Retail Plus General Partners Ltd.

The current move-in rent is £160,000 per annum and the purchase price of £1.6m reflects an initial yield of 9.4%.

Simon Beanland, principal at Avison Young, said. “We are delighted to have secured this leading retail parade and established a nightclub in Newcastle city centre.

“There is already an exciting occupant signed for the corner unit with good interest in the remaining commercial space.

“We believe that once occupied, these units will transform this part of downtown, delivering excellent performance for our client.”

Vesa Poikonen, founding partner of Sisu Advisors Ltd, said: “Sisu Advisors is committed to always finding the best deals and creating value for our investors.

“We are very pleased to have successfully purchased this attractive asset offering a high yield with a long-term rental profile and an added advantage through active asset management.”

MHPI Ltd and Allsop acted on behalf of the seller.

The deal comes after another prime site in the area was purchased by London-based flexible office firm Airivo.

He bought Grainger Chambers at 3-5 Hood Street, which has five floors of office space and a bar and restaurant on the ground floor and basement taken over by another Vaulkhard Leisure business, the Castros Cuban bar and restaurants.