Weekly Wrap

Fitzroys Weekly Wrap - 17th May 2019

Posted on 17th May 2019

000 Retail 05

521-525 Chapel Street, South Yarra
On a 492sqm site, the pair of two-storey buildings totalling 430sqm sold for $7.1 million.

43 Fitzroy Street, St Kilda
Home to Solly Lew Pharmacy and gym F45, the 370sqm two-level property sold for $5.8 million at a 4% yield.

509-513 Riversdale Road, Camberwell
A local investor bought the three shops on a 537sqm site for $4.65 million, at a 3.7% yield. The fully leased property is tenanted by a newsagency and restaurant Camberwell Curry house.

100 Chapel Street, Windsor
The two-level building of 339sqm is on a 185sqm site, and sold for $3.25 million at a 3.85% yield.

Shop 1, 141 Windermere Boulevard, Pakenham
The Bakery Store premises of 80sqm sold for $500,000, with a lease until 2023 plus option that returns $34,608pa plus GST.

Shop 1, 452 Elizabeth Street, Melbourne
Bubble tea retailer Happy Lemon leased the 24sqm space at around $5,417/sqm.

000 Specialised 05

Shops 2 & 3, 240 Caroline Springs Boulevard, Caroline Springs
The orthodontic practice of 180sqm comprises two separately titled shops and traded for $1.56 million, and is leased until 2029 plus options to 2039, returning $95,000pa.

Shop 3, 11-17 Pearcedale Parade, Broadmeadows
The medical and dental practice of 170sqm sold for $1.451 million with a new 10-year lease plus options to 2039, and returns $90,000pa.

2-4 Maksi Way, Cranbourne North
Across two shops on two titles, the 175sqm vet clinic sold for $975,000 with a lease until 2022 and options to 2032, and brings in $59,794pa plus GST.

000Industrial 05

203 Palm Springs Road, Ravenhall
A private developer purchased the Industrial 3-zoned 6.8ha site for $13.6 million.

1-11 McNaughton Road, Clayton
An owner occupier paid $4.9 million for the vacant 3,296sqm factory warehouse, which is on a 5,375sqm site with 20 on-site parking spaces.

18-20 Glenvale Crescent, Mulgrave
Furniture company De Rucci bought the 2,100sqm office and warehouse for $2.95 million.

41/1508 Centre Road, Clayton
Health More leased the 5,177sqm warehouse, formerly home to Stillwell Motors, on a 5-year deal at $100/sqm.

349A Darebin Road, Thornbury
Reveal Productions signed a 4+4-year lease at $81,000pa for the facility, which comprises a 1,215sqm warehouse and 200sqm of offices.

5 Stewart Street, Richmond
Sony Music inked a 4-year lease with options over the two-level 440sqm office and warehouse at $500/sqm net.

000 Offices 05

260-264 Highett Road, Highett
A local investor paid $3.375 million for the part two-level 900sqm office building, which is on a 1,120sqm site with 18 parking spaces and sold with approval for a commercial development of three levels plus basement.

Suite 101, 198 Harbour Esplanade, Docklands
The GWS Giants have leased the 77sqm office suite, a short distance from AFL House and Marvel Stadium, on a 3+2-year deal at $450/sqm with 3% annual increases.

000 Talking Points 05

Swanston Street record smashed amid CBD retail regeneration:
Another Asia-based food and beverage operator will set up shop in the Melbourne CBD’s northern precinct, taking a high exposure Swanston Street location to capitalise on the local student accommodation and residential development boom.

Fitzroys Associate Alex Shum negotiated the 5 5-year lease for the 50sqm space at 339 Swanston Street at $300,000pa net, achieving a record rate for the precinct of $6,000 per sqm.

The deal represents yet another benchmark achieved by Shum in a northern CBD retail pocket, following the off-market deal at 299 Elizabeth Street to international bubble tea brand Prime’s Hai, at $3,150 per sqm for the 73sqm space.

Shum and Fitzroys colleague Terence Yeh also recently leased the 200sqm double-fronted building at 423-425 Elizabeth Street to dessert house chain Hui Lau Shan from Hong Kong, at a precinct record of $400,000pa net.

Shum said the student accommodation and residential development boom throughout the Melbourne CBD’s north is continuing to drive generational change that is reshaping the retail landscape.

The new Swanston Street tenant will be taking the place of Student Flights, while Hui Lau Shan moved into the long-term home of Spot On Motorcycles.

“The space is in a premium position for pedestrian traffic flow, adjacent to Melbourne Central station and shopping centre, close to the new CBD North Metro underground station and multiple tram routes, opposite the State Library, and just moments from RMIT University and the University of Melbourne,” Shum said.

“This property presented an ideal opportunity to capture the student market, and the enquiry we received demonstrated the ongoing massive demand from food and beverage operators looking to secure a space in the northern part of the CBD.

“This demand, driven by Asia-based hospitality businesses, continues to push rental rates into uncharted territory.”

Shum said the CBD’s north - especially along Swanston and Elizabeth Streets - is becoming increasingly sought after and targeted by Asia-based franchises who are well-known
overseas, as they are familiar to and popular with the large numbers of students living in the surrounding high-rise developments.

Shum said the Chinatown precinct has traditionally been designated as the hotspot for Chinese and other Asia-based operators, but the current in student accommodation and high-rise development has in a sense created a new Chinatown in Melbourne’s CBD.

Fitzroys also recently sold the 125sqm space at 526 Swanston Street to a Singaporean- based investor with a portfolio of successful restaurants in their Home country for their first Australian venture, looking to capitalise on the location within the city’s renowned universities precinct.

Data from the Department of Education shows international tertiary and post-secondary student enrollments in Victoria have jumped by nearly 44% in the past three years to almost 270,000.

According to analysis of Melbourne City Council data, there are nearly 13,700 apartments in the northern CBD area above Bourke Street that are either under construction of have been approved.

Disclosure:Fitzroys Property Wrapis 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 2019 Fitzroys.