Weekly Wrap

Fitzroys Weekly Wrap - 28th June 2019

Posted on 28th June 2019

286, 286A & 288 Doncaster Road, Balwyn North
The 519sqm site has a 239sqm 2 storey building which sold for $2.15 million with leases to three tenants – Yuppy Puppy Day Spa, Designer Hair Studios and Mazark Architects – returning a combined $99,261pa plus outgoings and GST.

290 & 292 Doncaster Road, Balwyn North
Next door, the 158sqm building on a 422sqm site changed hands for $1.68 million. Leases to Sushi Café and Decorator Curtains & Blinds return $70,890pa plus outgoings and GST. The neighbouring properties are zoned Commercial, have on-site parking and rear right of way access.

Shops 2 & 3, 431 St Kilda Road, Melbourne
A NSW-based investor purchased the shops on the ground floor Fawkner Towers for $1.5 million at a 5.55% yield. Fawkner Express Convenience Store has a 5+5+5-year over the 85sqm property.

493 Tooronga Road, Hawthorn East
A local resident paid $850,000 at a 4.7% yield for the recently refurbished 70sqm pizza venue, which has a new 5-year lease.

8 Maksi Way, Cranbourne North
The 148sqm shop, leased to Indian grocery store VSP Grocers on a 5-year deal with options to 2023, sold for $735,000.

442 Station Street, Box Hill
Furniture company Ausaca leased the 467sqm showroom for 3 years at $150/sqm.

1430 Malvern Road, Glen Iris
The two-level 155sqm building is on a 217sqm site with 6 parking spaces, and sold with a short-term lease to The Butterfly Foundation for around $1.216 million.

554 Burwood Road, Hawthorn
360 Financial Strategists leased the 300sqm office at circa $325/sqm.

10 Queen Street, Melbourne
The Veterinary Practitioners Registration Board leased the 250sqm Level 14 office space at around $420/sqm net, from developer and landlord Riverlee.

420 St Kilda Road, Melbourne
Multinational brewing company Molson Coors will open its first Melbourne office, taking an 18-month lease assigned by Mitel at $364/sqm net.

188-196 Gertrude Street, Fitzroy
State Planning Minister Richard Wynne is moving his offices from 232 Brunswick Street to the former Deans Art supplies ground floor space of 135sqm, signing a 4-year lease at $87,500pa.

26-28 Chesterville Road, Cheltenham
German-based Fresenius Medical Care sold the 551sqm hospital for $5.52 million at a 5.1% yield to a local investor. Day surgery operator Cura Group, owned by Fresenius, has a 10-year lease over the 1,172sqm General Residential-zoned site.

1301-1303 Nepean Highway, Cheltenham
The Cheltenham Physiotherapy Clinic and Pilates Bayside studio for $2.62 million. The 1,272sqm site has a 435sqm building area and 15 car parks, and has a new lease until 2034 with options returning $125,000pa net.

514 High Street, Prahran
The former dental clinic of 115qm is on a 354sqm site with five on-site parking spaces, and sold with vacant possession for $1.35 million.

148-156 Jetty Road, Curlewis
A Sydney-based investor purchased the G8 Education childcare centre in Geelong’s east for $4.815 million. The 825sqm facility is licensed for 93 places and is on a 3,365sqm site, with a 10-year lease with options to 2058 returning $307,235pa plus GST.

22-24 Queens Avenue, Hawthorn East
A local developer purchased the 416sqm site for $3 million. Zoned Commercial 1, the property has a 17m frontage and has a permit for a 26-apartment development.

20 Aristoc Road, Glen Waverley
An investor paid $1.8 million for the Sheen Panel Group office and warehouse property of 1,040sqm, at a 3.1% yield.

7 Edinburgh Street, Oakleigh South
Glass Imagery purchased the 592sqm office, showroom and warehouse building, on a 738qm site with 3 parking spaces, for $1.2 million

80-90 Waverley Road, Malvern East
The Australian Academy of Dance leased the former fire station of 1,184sqm on a 5-year term at $270,000pa.

2 Tyrone Place, Erskine Park
Ascendas-Singbridge leased the 21,142sqm free standing distribution centre at 2 Tyrone Place on a 5-year term at $122.50/sqm net.

Bubble Tea Demand Spills Over Across Melbourne’s CBD

Demand from bubble tea traders seeking retail space is spilling over across the city, as The Alley LuJiaoXiang moves to open its second CBD site, on busy Elizabeth Street.

Fitzroys Associate Alex Shumnegotiated the 5+5-year lease for 103 Elizabeth Street at $200,000pa, on behalf of a private investor. The rental rate reflected $2,667/sqm for the 75sqm space.

The Alley LuJiaoXiang operates within QV Melbourne on Lonsdale Street, as well as at Highpoint Shopping Centre in Maribyrnong.

It will be moving into the space formerly occupied by Subway, marking another step in the retail refocus occurring along Elizabeth Street.

“The bubble tea phenomenon has been driven by the increasing number of international students in Melbourne, which has boosted pedestrian traffic as well as the immediate population across a string of new student accommodation and high-density residential developments,” Shum said.

“Demand from Asia-based and Asian cuisine food and beverage operators is currently reshaping the retail landscape across the north of Melbourne’s CBD, and we are seeing this spill over across the rest of the city.

“That demand is translating to an uplift of rents in new CBD retail precincts, and a generational shift in tenancy mix.”

Shum recently leased the 50sqm space at 59 Elizabeth Street, closer to Flinders Street Station, to international chain Gotcha Tea at $165,000pa net.

Further north in the CBD, Shum leased 299 Elizabeth Street to another international bubble tea brand, Prime’s Hai at a record rate for the area of $3,150/sqm.

Shum and Fitzroys colleague Terence Yeh also leased the former Spot On Motorcycles building at 423-425 Elizabeth Street to Hong Kong dessert house chain Hui Lau Shan at a precinct record $400,000pa net.

Shum has just negotiated a 5+5-year deal lease over the 50sqm space at 339 Swanston Street to an Asia-based food and beverage operator at $300,000pa net, at another precinct record of $6,000/sqm. The operator will take the place of Student Flights.

More Eastern Suburbs Office Sales

Long Yang Holdings has paid $11 million for the 19 Shierlaw Avenue office building in Canterbury, at a 5.3% yield.

Fully leased to three tenants, including Townshend Contract Builders, Price Gibson and Scientific Management Associates, the three-level, 1,861sqm building has basement parking for 40 cars and returns $592,795pa.

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 2019 Fitzroys.