Weekly Wrap

Fitzroys Weekly Wrap - 22nd April 2022

Posted on 22nd April 2022

71-73 Church Street & 36 Carpenter Street, Brighton
A local investor paid $16.2 million for the fully-leased heritage-style 990sqm building on a 931sqm corner site. It is leased to global sportswear giant Nike, national footwear retailer Ecco, bakery Laurent, and office tenants White Fox and 2 Construct. The sale price reflected a 3.8% blended yield, a land rate of $17,363/sqm and building rate of $16,480/sqm.

587-593 Chapel Street, South Yarra

A local investor bought the 4 adjoining freeholds on a 354sqm Activity Centre-zoned site for $5.825 million, at a 2.9% passing yield. It is currently occupied by Jumi’s Café, Bisonte and Green Cup. The vendor had owned the property since the 1940s.

146-154 Elgin Street, Carlton

The circa 1881 heritage listed Carlton Post Office building sold for $5.525 million, at a building rate of $14,540/sqm. It is on a 645sqm site and was sold with vacant possession.

720 High Street, Armadale

The 150sqm 2-level building on a 134sqm site sold for $1.58 million, reflecting a 3.5% yield and land rate of $11,900/sqm. It was offered with a lease until January 2025 to Douglas Stewart Fine Books.

392 Clarendon Street, South Melbourne

A Tasmanian buyer paid $3.15 million for the 3-storey shop, on a 4.04% yield. It has a 7-year lease to Body Freedom Urban Spa & Clinic with 3 5-year options. The property has had 3 owners over the past 165 years.

523 Whitehorse Road, Mitcham

The 214sqm single-storey shop sold for $1.64 million at a 3.1% yield. Wallpaper Brokers has 2 years remaining on its 4-year lease, returning $51,145pa.

256 Swan Street, Richmond

The 230sqm building home to Bruce Dowding and Jason Baker’s Cochin Wine Bar & Restaurant sold for $1.895 million on a 3.1% yield. It has a 5+5-year lease returning $59,000pa.

140 Bourke Street, Melbourne
The 664sqm 7th-floor office sold for $6.6 million. The building was originally Australia’s 1st purpose-built multi-screen cinema and converted into office space by Michael Drapac.

Level 3, 162 Collins Street, Melbourne

Amobee leased the 60sqm level 3 office for 12 months at $960/sqm gross. HUB is the landlord.

222-224 Discovery Road, Dandenong South

The 1,676sqm warehouse on a 2,955sqm Industrial 1-zoned corner site sold for $4.1 million on a 3.62% yield. It has a 4+3-year lease from August 2020.

72-74 Northern Road, Heidelberg West

A local owner-occupier bought the 1,160sqm Industrial 1-zoned site over 2 titles for $1.91 million.

Unit 8, 272 Lower Dandenong Road, Mordialloc

A neighbouring owner bought the vacant 162sqm studio warehouse for $500,000.

29-31 Butler Street, Richmond

An international business looking to expand their business in Melbourne leased the 470sqm warehouse at $133,000pa.

47 Reynolds Parade, Pascoe Vale
A local investor bought the vacant unrenovated weatherboard house on a 607sqm General Residential-zoned site for $1.22 million.

707 Malvern Road, Toorak
An investor bought the 265sqm building home to a dental clinic for $3.8 million at a 3.7% yield. It is on a 467sqm corner site and has a 5-year lease with 3 5-year options returning $145,000pa.

ASX-listed Developer Buys Southbank Site
Cedar Woods has paid around $26.5 million for a Southbank site that is one of a row of properties slated for development.

The 2,581sqm site at 141-151 Sturt Street currently comprises a 2-storey building with an IGA supermarket, Southbank Medical Clinic and the offices of personal development group Landmark.

Xia Zhang’s Fortune ZMC was the vendor, which took control of the property in March last year following a deal with Evolve Development.

Next door, at number 135, Evolve has a permit to develop an 18-storey tower with 206 apartments, while on the other side of the property, build-to-rent group Novus is planning a 20-storey, 170-apartment project at number 153. It bought the 1,800sqm site from architects Rothelowman for $20 million.

Rebirth for Former Calombaris Restaurant Building
After sitting vacant for 2 years, the Kew Junction former home of Hellenic Republic - part of George Calombaris’ collapsed restaurant empire - is being reborn.

Fitzroys’ James Lockwood leased 26 Cotham Road to chefs Ayhan Erkoc and Federico Perez Lopez for their new venture, Cotham Dining.

The long 6-year deal with 2 6-year options was struck at just under $200,000pa.

The 635sqm 2-storey building is on a triple-fronted 515sqm site with a large 17.13m frontage to busy Kew Junction.

Cotham Dining brings together the former Panama Dining Room and Feast of Merit chefs with a seasonal menu heavy on charcoals and woodfires, and which

draws on the large family meals of their respective Turkish and Colombian heritages.

The venue seats 150 on the ground floor and holds 100 on the second floor. The distinctive thatched ceilings have been maintained, and the dining room has been refurbished with rustic elements and features exposed brick and greenery.

“It’s fantastic to see quality operators take up this landmark site after it spent so long sitting empty. This is a huge win for the area and for Melbourne’s culinary scene,” Lockwood said.
Lockwood said hospitality operators have played a prominent role throughout Melbourne’s suburban retail leasing landscape since the beginning of the COVID period.

“The spike in hospitality leasing began as a means for operators to quickly take advantage of heightened demand for delivery and takeaway services during lockdowns, but now we’re receiving high-quality enquiry from restaurant operators with more ambitious plans for the dining experience,” Lockwood said.

“This city has a renowned foodie culture and operators are excited to cater for the huge built-up demand for quintessential Melbourne experiences after 2 years of lockdowns and restrictions. Melburnians have emphatically shown their desire to go out and enjoy dinner and each other’s company as we’ve returned to a COVID-normal environment.

According to Fitzroys’ most recent Walk the Strip report, leasing deals to hospitality tenants were accounting for half of all retail deals deep into 2021, well above the circa 28% proportion of Melbourne’s shopping strips that are leased to food and beverage operators. Lockwood said the trend has continued into 2022.

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.