Weekly Wrap

Fitzroys Weekly Wrap - 10th September 2021

Posted on 10th September 2021

000 Retail 05

244-246 St Georges Road, Fitzroy North
Located within the popular Fitzroy North Village opposite local institution Piedemontes Supermarket, the two storey building of 425sqm leased to Panna Thai sold on a 2.2% yield and achieved a record price for the area.

288-292 Whitehorse Road, Balwyn
The 686sqm corner building anchored by an ANZ bank branch sold for more than $6 million. Zoned Commercial 1, it returns $250,068pa net from multiple tenancies.

16 Michael Street, Brunswick

The 905sqm warehouse home to bar Howler sold for $4 million. Howler has a new 5 5-year lease over the Mixed Use-zoned site, returning $104,000pa plus outgoings and GST.

115-117 Gardenvale Road, Gardenvale

The 240sqm shop sold for $2.225 million on a 3.08% yield. It is on a 355sqm site with an 8m frontage.

403 High Street, Ashburton

The 140sqm shop on a 235sqm site sold for $1.035 million, at a 3.38% yield. It has a 5-year lease to an op-shop returning $35,000pa net with 3% annual increases.

2 Guests Lane, Melbourne

Pinot & Picasso leased the 98sqm space on the corner of Little Bourke Street for 5 years, at $82,000pa. The franchise has 55 studios nationally that offer drinks and painting lessons.

189 Queen Street, Melbourne

Further down Little Bourke, a new hospitality group leased the 211sqm corner restaurant space at the base of the Adina Hotel. The Queen Street Bar & Grill signed a 10-year deal at $140,000pa.

000 Offices 05

2/1632 High Street, Glen Iris
The 110sqm office suite with 3 parking spaces sold for $568,000 on a 5.5% yield. It has a new 3-year lease to Azured Consulting Pty Ltd returning $32,000pa plus outgoings and GST.

380 Lygon Street, Carlton

Co-working space operator CreativeCubes.Co leased nearly 2,000sqm at Lygon Court, adding to its existing locations in Hawthorn, South Melbourne and Richmond. It has plans for 7 more venues totalling 15,000sqm over the next 3 years. The Banco Group-owned Lygon Court is home to the Nova cinemas, a Woolworths supermarket and café Brunetti.

Level 2, 287 Collins Street, Melbourne

Expanding software development company Easygo Solutions leased an additional 693sqm, above its existing footprint, at $745/sqm gross for 3 years.

Level 4, Suite 1, 210 Canterbury Road, Canterbury

Flinders Banner leased the 345sqm office at around $90,000pa.

000Industrial 05

42 Appleton Street, Richmond
Home to a Citroen repairs workshop, the 440sqm brick warehouse sold for $2.52 million. Paris Motors has been at the site for over 15 years and has a monthly tenancy returning $53,893pa plus outgoings and GST.

1-12/26 Rushdale Street, Knoxfield

The 12-unit development sold out off the plan, with units ranging in size from 195sqm to 1134sqm selling for between $555,000 and around $2.6 million.

158 Murphy Street, Richmond

Harvey Norman signed a 5-year lease at $427,000pa plus GST for the 2,100sqm warehouse it has been sub-leasing for a number of years. The privately-owned property was previously occupied by a mailing house that was relocating and Harvey Norman took on the remainder of the lease.

8-10 William Angliss Drive, Laverton North

A storage and relocation company leased the 6,174sqm facility at a building rate of $72/sqm. It includes a 4,384sqm warehouse and 1,790sqm of office space.

000 Development 05

294-296 Sydney Road, Coburg
Currently a used car dealership, the 488sqm corner site sold to a land banking developer for $2.5 million ($5,122/sqm), on a passing yield of 1.4%.

000 Specialised 05

1/500 High Street, Epping
The 1,600sqm strata-titled property leased to ASX-listed tenants Capital Radiology and Slater & Gordon sold for $6.85 million, at a 5.5% yield. It is on a corner site fronting High Street and Childs Road.

000 Talking Points 05

Flinders Lane Draws Rodd & Gunn for Australian HQ
For over 100 years from the 1880s, Flinders Lane was the home of the garment and textile trade in Melbourne, and Manchester House was at the centre of the trading activity due to its proximity to Flinders Street station.

Designed by architects Bates Peebles and Smart and built over 1911 and 1912 for Adelaide clothing manufacturers, G & R Wills and Company, the imposing corner building at 234 Flinders Lane has since been converted to provide apartments, offices and retail spaces.

Most recently, the 2nd floor has been completely restored to recreate the original warehouse space – down to the red brick walls, concrete flooring and exposed ceilings, now juxtaposed with current-day services and facilities. It has just been leased as the Australian office HQ of Rodd & Gunn, the global manufacturer and retailer of clothing, footwear and accessories, which was established in 1946.

Rodd & Gunn are relocating from Prahan and has taken a new 5-year lease of the 590sqm floor.

Fitzroys’ leasing agents Rob Harrington and Stephen Land commented that this part of Flinders Lane has become an established area for a variety of occupiers including those in the tech, higher education and creative sectors, with tenants often seeking premises specifically between the junctions of Swanston and Queen Streets.

The transaction closely follows Fitzroys’ letting of 2,700sqm to the Victorian government’s Apprentices Victoria at 278 Flinders Lane/271 Collins Street in the same city block.

In another deal leased by Land, a pastoral company has found its Melbourne CBD calling at the Scots’ Church’s historic 5-storey Assembly Hall building, in the Paris End of Collins Street.

The 5 5 5-year lease for the small 58sqm mezzanine office was negotiated at $23,500pa plus GST.

“The offices suited this tenant - operating a pastoral business and being based outside of Melbourne - as a CBD office base to use from time-to-time during the week,” Land said.

“This deal is demonstrated the ongoing importance of a central location that the CBD satisfies for all sorts of businesses and operators.”

He said the company was attracted to the heritage of the building. Built in 1914, the Gothic revival-style Assembly Hall offers rare self-contained offices in city’s Paris End and sits immediately in front of Westpac’s modern headquarters, and is adjacent to the 1873-built Scots’ Church, on the corner of Russell Street.

There is also retail space within the building that includes the well-known rare books store Kay Craddock. The entire building is again fully leased as a result of this lease.

Land said the the offices are mostly small single room offices ranging from 15 to 50sqm.

“When they become available, they are often well received given their character, easily manageable size, and proximity within the coveted Paris End of Collins Street, and close to high-quality cafés, eateries and bars.

“We continue to see tenants looking for highly accessible locations, while using the changing market and working conditions to seek out spaces they previously would not have considered.”

Land said reassessment of office space requirements will see fluid movement of tenants between the CBD, inner-city and inner suburban markets for some time.

$220m Sale Stitched for Bradmill Factory
ASX-listed Irongate has partnered with Frasers Property Australia to acquire the former Bradmill denim factory site for over $220 million.

The site covers more than 50 hectares and has been earmarked by previous owners for a $2 billion-plus urban renewal project with up to 3,750 dwellings.

Chang Sheng bought the site in 2016 for $172 million in a joint venture agreement with Australian Chinese-language media executive Tommy Jiang. Before then, it had been owned by former Carlton Football Club vice-president Colin De Lutis, who took over the Bradmill business after it fell into receivership nearly 20 years ago.

National Demand for Broadmeadows Warehouse Amid Short Supply
The ongoing surge in demand for industrial investment assets during COVID has seen a Broadmeadows warehouse attract buyers from across Australia and smash the reserve price at auction.

Fitzroys’ Brent Glassford and Marco Sandrin, in conjunction with Dominic Vardaro and Alex Gazis of National Estate Agents, sold 5 Northcorp Boulevard for $2.91 million via the virtual auction, with the sale price smashing the reserve by $500,000 and reflecting a remarkably sharp 3.8% yield.

Positioned close to the gateway of the Northcorp Industry Park, the 1,330sqm building comprises a warehouse with a high 9.5m maximum clearance and 2 levels of office space and amenities, on a 2,243sqm site.

It is leased to TFG Group on a 3-year term returning $113,300pa plus outgoings and GST.

Glassford said the purchaser is a private investor looking to capitalise on the modern asset’s quality and location.

“This is not a price point or asset size that has typically attracted interstate investors in the past, but we had more than 120 enquiries from across Australia. This demonstrated both the huge demand of industrial investments during the COVID period, and the low availability of quality stock across the board, from smaller warehouses to institutional-grade assets.”

Disclosure: The weekly Fitzroys Property Wrap is for information only on transactions in the Melbourne property market. Fitzroys provides this information as a public service. We are not purporting that all sales and leases within this report were transacted by Fitzroys. Terms/Privacy © Copyright 2021 Fitzroys.