Weekly Wrap

Fitzroys Weekly Wrap - 30th June 2023

Posted on 30th June 2023

331-335 Lygon Street, Brunswick East
The 290sqm building on a 307sqm corner site sold for $3 million, on a 4% yield. Figlia Pizzeria & Grana Deli, run by the operators of eateries Tipo 00 and Osteria Ilaria, has a 7+7+7-year lease.

260 Glenferrie Road, Malvern
A local investor bought the 170sqm property on a 4% yield, which is on a 220sqm Commercial 1-zoned site. It is occupied by The Master Cobbler on the ground floor and Malvern Psychology on the first floor.

74 Smith Street, Collingwood
The 170sqm building on a 151sqm site, occupied by long-term tenant Smith’s Kebabs, sold to a local investor for $1.7 million, on a 3.7% yield. Smith’s Kebabs has more than 5.5 years remaining on its lease, plus a 5-year option.

10 & 11/121 Grices Road, Clyde North
The newly-constructed 167sqm building, plus a 62 sqm alfresco area, over 2 titles sold for $1.518 million. Matilda’s Café, Woodfired Kitchen and Bar has a 10-year lease to October 2032 plus options to 2042 that brings $87,450pa plus GST.

Shop 2, 79 Hamilton Place, Mount Waverley
Bubble tea brand Teaser Tea leased the 57sqm shop for 5 years plus options at $38,000pa net.

1 Maddock Street, Windsor
A superfund investor bought the 183sqm building on a 252sqm site opposite Windsor train station for $2.25 million, on a 3.3% yield. It is occupied by advertising agency Sunday Gravy until 2026 with no further options.

15/36 Sabre Drive, Port Melbourne
An owner-occupier paid $2.1 million for the 2-level 436sqm office with 13 parking spaces.

838 Collins Street, Docklands
A project management firm acquired 5 office suites totalling 338sqm for $1,921,530.

119 Rose Street, Fitzroy
The 416sqm brick warehouse occupied by renowned croissant-maker Lune sold to a private investor for $3.8 million. Lune has a 4.5-year lease with a 7-year option.

107 Keilor Road, Essendon
An investor paid $2.3 million on a 3.6% yield for the 220sqm workshop, office and storage building on an 839sqm Commercial 1-zoned site. UltraTune has occupied the site for more than 30 years.

4/30 Triholm Avenue, Laverton
The 225sqm unit sold to an owner-occupier for $590,000.

108-112 Rodeo Drive, Dandenong South
Universal Logistics Management leased the recently refurbished 1,811sqm office and warehouse for 5 years at a building rate of $130/sqm.

262 Victoria Street, Brunswick
A local developer bought the Mixed Use-zoned 406sqm corner site for $1.82 million. It has plans for a 5-level building with 14 apartments.

604 Waverley Road, Glen Waverley
The 1,394sqm corner site occupied by Mayfield Childcare sold for $4 million on a 4.15% yield. It has a 10 10-year lease from 2022 returning $180,090pa plus GST.

Substantial Inner-North Apartment Complex Site Sells for $430,000 Above Reserve
A large 1,170sqm landholding with a 20-unit apartment complex in the lifestyle hotspot of Thornbury has sold for the first time in 60 years, to a Sydney-based buyer for $3.53 million - a massive $430,000 above reserve - demonstrating the national appeal of Melbourne’s inner north.

Fitzroys Mark Talbot and Ervin Niyaz sold 12 Dundas Street under the hammer on behalf of the vendor whose family originally built the property.

The auction campaign generated more than 120 enquiries and culminated in four bidders contesting the auction.

The sale price reflected a sharp 3.3% yield.

Talbot said the buyer intends to refurbish the property, hold it as an investment and enjoy the income.

“Rents are on the way up and will continue to be while Melbourne is experiencing historically low vacancy rates amid a housing shortage - with the inner-north market particularly tight.”

“Australia is forecast to receive a record intake of migrants with 400,000 expected this financial year and 315,000 in the following year, and many will come to Melbourne and initially be looking to rent.

“The shortage of housing and record migrant intake will put further upwards pressure on demand for new dwellings and likely continue to flow on to rents, making this an opportune acquisition.”

He added that many people are looking to live in well-connected inner suburbs close to hospitality and lifestyle amenity, particularly at a time of flexible working arrangements.

The site is immediately opposite Woolworths and Aldi supermarkets and is a short walk to hugely popular High Street, and notable traders including Little Henri, Umberto Espresso Bar, Barton Fink, Cedar Bakery, Thornbury Theatre, Short Round, and a plethora of local and established businesses.

The property is also surrounded by a number of completed and pipeline developments that are bringing greater vibrancy and foot traffic to the area, and is in close proximity to Thornbury train station plus excellent tram and bus transport options.

“We had enquiry from locals, buyers across Melbourne and across Australia, leading to a very strong result $430,000 above the reserve. Melbourne’s inner north has a reputation across the country as an excellent lifestyle destination and an excellent place to invest,” Talbot said.

$1.7b Overhaul for Queen Victoria Market Precinct
The City of Melbourne has appointed Lendlease to the $1.7 billion redevelopment of the southern portion of the Queen Victoria Market precinct, which will deliver build-to-rent and affordable housing, an office tower, student accommodation and a new public park.

The 3.2ha site is bordered by Franklin, Queen and Peel streets and will be known as Gurrowa Place.

Lendlease will develop a 560-unit build-to-rent and affordable housing tower, as well as a 28-level, 43,000sqm office tower, and the 1.8ha public park.

Student housing provider Scape will separately develop a $350 million to $400 million student accommodation tower with 1,100 beds.

Also part of the redevelopment will be the existing heritage Franklin Street Stores being turned into a new retail village, the creation of a 220-space underground car park underneath the site for Market traders and visitors, as well as a civic pavilion, the Queen’s Corner Building.

Completion is targeted for 2028.

The Market precinct has recently seen the completion of another build-to-rent tower, by Mirvac and with 490 units, on what is known as the Munro site, as well as a boutique apartment hotel by Veriu Hotels.

Charter Hall Buys Home of Vegemite
Vegemite will continue to be produced in the Port Melbourne factory the famous spread has been made in for a century, after a $114.6 million sale and leaseback deal between manufacturer Bega Cheese and Charter Hall.

The property fund manager has acquired the 1 Vegemite Way property with a 15-year lease plus 10-year option to ASX-listed Bega Cheese, which took ownership of Vegemite in 2017 when it acquired a suite of products from Modelez International, formerly Kraft Foods.

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 2023 Fitzroys.