Weekly Wrap

Fitzroys Weekly Wrap - 12th July 2019

Posted on 12th July 2019

000 Retail 05

479 & 479A Toorak Road, Toorak
A Melbourne-based investor paid around $4.25 million for the 2-level, 257sqm building leased to Toorak Newsagency and Baker’s Delight, which returns a combined rent of $167,116pa plus outgoings and GST.

566 Station Street, Box Hill
An investor bought the 216sqm 2-level building for $4.1 million, on a 3.5% yield. The property is leased to Taiwanese eatery Easy Café.

1420 Malvern Road, Glen Iris
The 160sqm building sold for $1.225 million and has 3 income streams, from interior designers Judith Augustine in the ground floor retail space and two separate apartments.

597 Malvern Road, Toorak
Fashion retailer Coco & Lola is moving to bigger premises within Hawksburn Village, leasing the character building of 260sqm in a 5+5-year deal at $170,000pa.

264 Lonsdale Street, Melbourne
Lu’s BBQ leased the shop at more than $2,100/sqm for its third Melbourne store.

000 Offices 05

379 Docklands Drive, Docklands
Publishing company Prime Creative Media purchased the strata office component of MAB Corporation’s mixed-use Escala project for $8.1 million in an off-the-plan deal at around $7,000/sqm.

7 Ormond Boulevard, Bundoora
An interstate party paid $1.665 million for the medical and office space of 353sqm within the MAB Corporation commercial development.

000 Specialised 05

32A Green Gully Road, Keilor
Aged care operator Mayflower Brighton acquired the vacant 2ha former site of the Calder Rise Primary School for $8.2 million from the Victorian state government.

242-244 Springvale Road, Glen Waverley
A private group purchased the 613qm premises of Waverley Medical Centre, on a 1,504sqm corner site, for $7.28 million. The clinic has been operating for more than 30 years and its current lease returns $297,052pa plus outgoings and GST.

000 Development 05

22-24 Northumberland Street, Collingwood
Manfax Hardware and Paint owner Robert Larsson picked up the 825sqm Commercial 2-zoned site for $7.35 million, at $8,909/sqm, from a family that had built the office and warehouse facility in 1974.

836-842 Sydney Road, Brunswick
Cubo Group paid $4.6 million for the 1,531sqm combined site, which includes the State Savings Bank of Victoria building, a shop and the Charalambous hardware store, and was offered with vacant possession. Zoned Commercial 1, the site could make way for a project of at least six levels, and a development scheme has been prepared for the site with 57-apartments and retail. The 1913-constructed State Savings Bank component has a heritage overlay. The vendors were the operators of Charalambous, which has just closed after nearly 60 years of business.

624A & 634B Nepean Highway, Frankston
A local developer paid $3.4 billion for the “Oliver by the Bay” waterfront site of 4,577sqm, which is earmarked for residential development.

000Industrial 05

21 Elgar Road, Derrimut
A local investor bought the adjoining multi-level office, showroom and warehouse buildings for $5.7 million for their self-managed super fund. The properties have a combined building area of 3,202sqm, and are leased to Flip Out Trampoline for 5 years and Croc’s Playcentre for 10 years, with a combined rent of $392,586pa net.

64 & 66 Albert Street, Preston
An investor paid $2.92 million for the adjoining office and showroom buildings of 689sqm and 706sqm to previous owner occupier Dynamic Billiards Pty Ltd.

18-22 Salmon Street, Port Melbourne
Data centre and tech firm OptiComm Co signed a 5-year lease over the 1,400sqm office and warehouse at $280,000pa net.

143-145 Arden Street, North Melbourne
A food van manufacturer leased the recently-sold 340sqm warehouse on a short-term lease at $155/sqm.

000 Talking Points 05

Historic Carlton Building Back to Full Occupancy
One of Carlton’s most historic office buildings, on the former site of Royal Children’s Hospital, is back to full occupancy following a commitment from workplace rehabilitation services provider AMS Consulting Group.

Fitzroys agents Samuel Friend and Stephen Land negotiated the 3-year lease over the recently renovated 460sqm part-ground floor and full first-floor office space at $140,000 per annum gross.

Not-for-profits, government health organisations, architects and financial services firms were all keen on the space. Tenants in the building include Vic Health, Vision 2020, Centre for Policy Development, and National Education & Care Services.

The 6,178sqm building at 15-31 Pelham Street was part of the broader Melbourne Free Hospital for Sick Children site, which became the Royal Children’s Hospital. When the RCH moved to Parkville, the site was handed over to the Mental Health Authority in 1962 and the 15-31 Pelham Street building became St Nicholas’s Hospital, which closed in 1985.

Friend said building has received upgrades over recent years and has been at or close to full occupancy throughout that time.

“Businesses are increasingly looking to accommodate a generation of Melburnians that prefer to live, work and go out across the inner city. Carlton offers cheaper rents than the CBD, while 15-31 Pelham Street is accessible via a range of transport options and is a short walk from the Carlton’s amenity and lifestyle offerings.”

Fitzroys handled the $37.05 million transaction of the building late in 2016, with a private Melbourne investor picking up the asset.

Meanwhile, Melbourne CBD’s office boom could continue for some years yet. BIS Oxford Economics expects prime rents could rise a further 30% to 40% in the city over the next five years. The Property Council’s vacancy rate measurement of 3.2% at the start of this year may rise to just above 5% next as some 250,000sqm of new office stock is brought to the market, but will come back down to around 4% amid ongoing strong tenancy demand.

Newmark Adds to Portfolio
Newmark Capital has acquired Stockland’s Tooronga Village neighbourhood shopping centre in Glen Iris for around $63 million. Anchored by a full-line Coles supermarket and First Choice Liquor, the 8,793sqm centre also has 30 specialty stores and a weighted average lease expiry of 5.5 years, and returns more than $4.2 million. It is on an 18,430sqm site with 488 parking spaces.

Newmark Capital is moving ahead with its Jam Factory redevelopment that will create a $1.25 billion-plus precinct, featuring towers from four to 15 storeys with more than 50,000sqm of office space, as well as new retail and lifestyle space, and its popular cinema.

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.