Church Street, Brighton Retains Near-Zero Vacancy Rate
Boutique caterer Blakes Feast is the newest addition to Church Street, Brighton, which continues to attract high-quality tenants and maintain its Melbourne-low vacancy rate.
Fitzroys’ Tom Fisher negotiated the 5+5-year lease of 111 Church Street at $70,000pa net on behalf of a private investor. The dual-level 110sqm building will be home to the business’s 2nd Blakeaway site, from where prepared meals, breads, pastries and other daily items will be available for easy delivery or takeaway.
Blakeaway was launched in 2020 to offer prepared meals from Blakes Feast kitchens as Melburnians endured the first lockdowns of the pandemic. Initially available only online, Blakeaway is now looking to expand across Melbourne and capture established markets with a more readily accessible service.
“This deal reflects the huge take-up of space along shopping strips by food and beverage operators, and the ongoing demand from quality tenants for a prized space within Church Street, Brighton and its affluent, established catchment,” Fisher said.
“The huge shift in enquiry and leasing deals towards food and beverage operators seen with the arrival of COVID has continued through 2021. Demand for takeaway and delivery services has surged while Melburnians go through intermittent lockdowns,” he said.
Some 50% of leases struck by Fitzroys along Melbourne’s shopping strips this year have been to food and beverage operators, well above the average food and beverage presence of 28.4% Melbourne-wide, according to Fitzroys’ new Walk the Strip report.
“Hospitality operators have been snapping up small spaces for lease that allow them to quickly expand and establish themselves in new markets. While Blakeaway has been available online, it is opening bricks and mortar stores to make it more readily accessible to receptive catchments,” Fisher said.
Fitzroys’ Walk the Strip report also showed that Church Street, Brighton’s vacancy rate has come down throughout the COVID period to just 0.7%, the sharpest across Melbourne. Fisher said the long-term lease was yet another example of the high regard and unwavering confidence retailers have for Church Street.
South Yarra Set for Australia’s Largest Build-to-Rent Project
Australia’s largest build-to-rent project to date has been approved for a site in South Yarra’s Forest Hill precinct.
US-based Greystar will develop the $500 million facility, which will have 625 apartments across 2 towers of 30 and 21 storeys over a combined basement, and include 2,000sqm of office space, ground level retail, and a pedestrian laneway linking the facility to South Yarra train station.
Greystar bought the neighbouring Yarra Street and Claremont Street sites early in 2020. The development is the 1st to be built as part of a $1.3 billion Australian build-to-rent fund Greystar put together with backing from Canada’s Ivanhoé Cambridge, Dutch group APG Asset Management, and Finland’s largest pension fund, Ilmarinen.
The Victorian Government announced last year it would halve land tax for build-to-rent development from 2022 until 2040.
Major build-to-rent projects in Melbourne’s include Mirvac’s developments next to the Queen Victoria Market, on the former Melbourne Convention Centre site at 7 Spencer Street, and a site in Brunswick, while Oxford Properties is planning a $450 million project in Footscray, and investment manager Hines has just bought a 4,247sqm site also in Brunswick for a $250 million building.
German Fund Manager Buys Port Melbourne Wine Warehouse
Industrial investment asset yields continue to tighten, with German-based fund manager Institutional Investment Partners buying the Port Melbourne warehouse home to Rathbone Wine Group for $81.6 million, on a yield of 3.6%.
The Jreissati family were the vendors of the 1.69ha corner site at 262 Lorimer Street, selling the property 7 years after they paid $31 million in a sale and leaseback deal with Rathbone Wine Group. The 15,246 sqm building includes a temperature-controlled warehouse and distribution facility, a 4-level office, café and a multi-storey car park.
Rathbone Wine Group, which owns wine brands Yering Station, Xanadu and Mount Langi Ghiran, has signed a new 13-year lease, while the CFMEU’s training unit leases a 2nd floor office space looking out across the Yarra River.
The site is near the Fishermans Bend innovation precinct, where the Victorian government has committed $179.4 million for the first stage of the former General Motors Holden site’s redevelopment into a technology hub. The University of Melbourne has just announced it will open a new campus in the precinct for its faculty of engineering and information technology.
Large Format Retail Attracts Investment
QIC has bought the Craigieburn Junction centre for $135 million, as large format retail assets perform strongly during the COVID period.
The 25,000sqm centre is tenanted by Nick Scali, Supercheap Auto, Freedom, Caltex, Hungry Jack’s, a supermarket, medical centre and childcare centre, and sold at a 5.4% yield. It is on a 6.13ha site that offers value-add opportunities.
PGIM Real Estate was the vendor of the centre, which opened 2 years ago after being developed by Oreana Property Group.
Meanwhile, ASX-listed HomeCo Daily Needs Trust bought the Pakenham Lifestyle Centre on the Princes Highway from 3 Melbourne families for $98.5 million, on 6% yield. Situated on a 7.6ha site, the 30,716sqm centre is anchored by JB Hi-Fi, The Good Guys, Amart Furniture and Supercheap Auto.
The trust also bought a Coles-anchored neighbourhood centre in Woodlea for $55.3 million, at 5.25%. The asset is part of the town centre in Mirvac and VIP Properties’ Woodlea housing estate.
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.