Investor demand drives $155m in Sydney apartment block and townhouse sales
Strong rental fundamentals and tight supply have driven more than $155 million in Sydney apartment block and residential investment sales over the past year.
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Sydney’s residential investment market has recorded $155 million in apartment block and townhouse sales over 2025, underscoring continued investor confidence in rental-led assets despite broader economic uncertainty.
The transactions were completed by Knight Frank’s Investment Sales agents James Masselos and Adam Droubi, who negotiated 19 sales across Sydney during the year.
Residential investments accounted for 75 per cent of their total sales activity, supported by more than 4,200 active purchaser enquiries.
Co-living deal sets national benchmark
Among the standout transactions was the off-market sale of 142 Carillon Avenue in Newtown, a 37-studio co-living apartment block located close to the University of Sydney and Royal Prince Alfred Hospital.
The property sold for $21.5 million, setting a new benchmark for the living sectors market nationally.
The deal achieved approximately $581,000 per bedroom, believed to be one of the highest per-bedroom results recorded for a co-living asset in Australia.
Inner-city assets trade in one line
Other notable sales included a group of 12 townhouses at 108 Illawarra Road in Marrickville, sold in one line for $14 million, and a block of 20 studio apartments at 171 Rowntree Street in Birchgrove, which changed hands for $6.7 million.
Both transactions reflected strong buyer competition for well-located residential assets with established income streams.
Supply constraints underpin momentum
Mr Masselos said Sydney’s apartment block market continued to benefit from tight supply and strong rental conditions.
“Apartment blocks and broader residential investments remain a robust asset class, underpinned by strong rental growth, record low vacancy levels and scarcity of stock,” he said.
He added that more than $25 million worth of residential investment opportunities are expected to come to market in 2026, with buyer enquiry remaining elevated.
Mr Droubi said competitive sales campaigns had become a feature of the market as investors sought secure income and long-term value.
“Supply constraints and ongoing population growth underpin market strength,” he said. “New approvals and completions lag demand, keeping stock tight and boosting both rents and prices.”
Vacancy rates keep pressure on rents
According to Knight Frank, rental demand across Sydney remains intense, with vacancy rates well below typical “healthy” levels.
Many middle and outer-ring suburbs are recording vacancies of around 1.5 per cent or lower, maintaining upward pressure on rents and reinforcing the appeal of residential investment assets.
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After half a century in the same hands, The Palladium blends Art Deco heritage, cinematic history and beachfront living in one extraordinary offering.
3 min
In Sydney’s Northern Beaches, there are plenty of homes with a multimillion-dollar view and an enviable position close to the sand.
This unique listing has all that, but it has also earned its page in the local history books.
After 50 years in the same hands, The Palladium in Palm Beach—once a famed dance hall, then a restaurant, a private residence, and an artists’ studio—is now back on the market with a price hopes of $13.5 million through BJ Edwards and David Edwards of LJ Hooker Palm Beach.
Positioned in a rare corner spot where Ocean Rd meets Palm Beach Rd, The Palladium has been front and centre observing the famous sandy stretch for almost a century.
Built in the early 1930s, the Art Deco building was originally conceived as a vibrant community dance hall; the “it” place to be for young folk during Sydney’s thriving interwar period.
Often the dances were held to raise money for the Palm Beach Surf Life Saving Club, and newspaper reports of the time told of rowdy parties lasting until the early hours, bootleg liquor arrests, and where shorts and sandals—or even pyjamas—were scandalously worn by “both sexes”.
Over the decades, The Palladium has worn many hats.
By 1943, the original owner, Joseph Henry Graham, had defaulted on his loan, and a mortgagee sale reportedly sold the building for £1550, which translates to about $137,000 today. It later became a dining space and a general store run by the Milton family. In the 1960s and early 1970s, the property was also home to the Blue Pacific Restaurant.
The current owners acquired the keys in 1976 when it began its next chapter as a creative hub. One of today’s vendors, filmmaker David Elfick, who has been a filmmaker and producer on such films as Newsfront and Rabbit-Proof Fence, has told stories of a free-spirited creative hub that has been used for film sets, to store numerous movie props, as editing rooms, to hold countless parties and has even hosted visiting members of the Royal Shakespeare Company.
From its famed beachside soirees to its grassroots film club nights, the venue has become woven into the cultural fabric of Palm Beach.
Today, that rich history has been reimagined into a coastal home that honours its past while embracing contemporary beachside living.
Built in a unique architectural style known as streamline moderne, the aeroplane hangar-like building reflects the era’s fascination with air travel, mass transport, and modernity. The facade is defined by a sweeping curved roofline and subtle nautical cues.
The main residence features a vast central living space framed by a number of bedrooms and sunrooms, as well as a front dining room and kitchen. In total, there are four to five bedrooms, three bathrooms and a powder room adjoining an upstairs loft space.
Big, broad windows draw in loads of natural light and provide iconic views, plus the sounds of the beach just across the road.
Many of the original elements remain, most fittingly the polished floors of the former dance hall. In the additional building at the back of the block, there is a separate, self-contained studio with its own bedroom, bathroom, kitchen and laundry. From its elevated deck, the outlook stretches across the full sweep of Palm Beach.
Outside, the expansive 1151sq m land parcel also features established gardens with veggie patches and standalone decks for quiet contemplation.
Sitting just across the road from the beach, the property is also within walking distance of local cafes and the surf club. Palm Beach Rock Pool is at one end of the beach, with the Palm Beach Golf Club and the water airport at the other end of the peninsula.
The Palladium and Palm Beach Studio at 16 Ocean Rd, Palm Beach are listed with BJ Edwards and David Edwards of LJ Hooker Palm Beach via a private treaty campaign with a price guide of $13.5 million.
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