Weekly Wrap

Fitzroys Weekly Wrap - 20th October 2023

Posted on 20th October 2023

109-111 Toorak Road & 1A-1C Murphy Street, South Yarra
A locally-based investor with offshore backing bought the 390sqm building for $6.23 million, on a 3.2% passing yield. The building comprises 5 shops plus a first-floor office and is underpinned by a renewed 5-year lease to real estate group McGrath.

446 Maroondah Highway, Lilydale
The 2,412sqm building occupied by Belgravia Group sold for $8.91 million on a 6.13% yield. Belgravia Group has a 10-year lease with options to 2042 that returns $546,000pa plus GST.

460 Church Street, Richmond
A local investor bought the 194sqm building occupied by Crust Pizza for $1.7 million. On a 186sqm Commercial 1-zoned site, the property returns $77,437pa plus outgoings and GST from a 5 5 5-year deal.

588 Malvern Road, Hawksburn
An owner-occupier bought the 100sqm terrace building, on a 150sqm site, for $1.92 million.

681 Burke Road, Camberwell
A local investor bought the 2-level 660sqm building for $4.85 million. It is on a 748sqm Commercial 1-zoned corner site with 12 car parks and was offered with short-term tenancies.

Building 1 & 2, 428 Mount Dandenong Road, Kilsyth
V8 Supercars identity Phil Munday offloaded the adjoining office warehouses for $2.4 million. The property totals 886sqm and includes 13 car parks, and has recently been home to Munday’s beer business, Public Brewing, with more than $700,000 worth of brewing equipment offered as part of the sale.

6/52 Wirraway Drive, Port Melbourne
Hospital and rehabilitation equipment provider Rehab Hire expanded into the 330sqm warehouse, signing a lease at $65,000pa.

Unit 20, 107-113 Heatherdale Road, Ringwood
The vacant 235sqm office and warehouse unit sold for $700,000, excluding GST.

3 View Court, Brighton
A local developer paid $2.4 million for the 777sqm site, which has a permit for 4 townhouses.

Remarkable City Fringe Opportunity Overlooking Carlton Gardens Hits the Market
An exceptionally rare opportunity to acquire a major CBD gateway property suited to a broad range of uses and positioned directly opposite Melbourne’s famous Carlton Gardens has come to the market.

Fitzroys’ Chris James, David Bourke and Ben Liu are managing the Expressions of Interest campaign for 38-44 Nicholson Street, Fitzroy on behalf of community housing provider Unison, with the campaign closing on 16 November.

Situated at the northeastern gateway of the Melbourne CBD and overlooking the Carlton Gardens, the offering comprises a grand 1850s Victorian structure of 2 substantial interconnected 3-storey buildings totalling 2,250sqm, which has been adapted to rooming house accommodation and provides a range of accommodation styles across 52 rooms.

“We’re expecting a range of buyers groups, given the site’s Commercial 1 zoning and enormous scope to repurpose for a range of alternate uses such as boutique accommodation, medical, office, education, repurposing for residences, specialist accommodation, and potential for redevelopment (STPA),” Bourke said.

“This is a once-in-a-lifetime opportunity to secure a landmark property and position opposite the Carlton Gardens and close to world-class lifestyle and hospitality amenity. It’s surrounded by iconic Melbourne’s landmarks including The Royal Exhibition Building and Melbourne Museum, and is within walking distance to the Melbourne’s Theatre and entertainment precinct, the city centre and its East End, Parliament train station, as well as the eclectic retail and lifestyle precincts of Gertrude Street, Brunswick Street and Smith Street.

“This part of Melbourne is incredibly tightly held.”

Bourke said the site is well-suited to medical and education users given its location in a health and education precinct with major institutions nearby including St Vincent’s Hospital, the Eye and Ear Hospital, and Epworth Freemasons Hospital, in addition to numerous specialist clinics and consulting rooms that cater to the various health institutions nearby, while Melbourne University, RMIT University and Australian Catholic University are all in proximity.

“Operators could also consider student accommodation as a potential use for the site, given its location near major universities and amenity, and the chronic shortage of student accommodation amid the ongoing return of international students and record number of new visas being issued,” Bourke said.

Chris James noted that the site was also primed for repurposing as private residences to cater for the strong demand for housing from Melbourne’s growing population seeking to take advantage of the amenity of the location.

Unison CEO James King said, “Unison’s decision to sell marks the end of a Victorian Government-endorsed strategy following a 2016 review commission by Yarra Community

Housing (now Unison Housing) of Unison-owned property. Under the strategy, rooming houses which were no longer fit-for-purpose, would be sold and the proceeds used to deliver modern self-contained housing for our residents. To date, Unison has delivered 216 new units with proceeds of the sales combined with other funding streams, with houses in Footscray, Fairfield, Heidelberg Heights and two locations in Werribee.”

The property is believed to be the second-ever documented house in Fitzroy. It was first known as Helena House, with the original section constructed in 1850 in the Regency style by William Pelling for John MacPherson. The house was home to a premier, a businessman and briefly, French violinist and composer Horace Poussard. It was acquired in 1887 by Melbourne merchant and speculator George Nipper who expanded the property in the conservative Classical mode and converted it to a boarding house. It then became known as Osborne House.

Nearly $115m of Epping Commercial Real Estate Deals
In one of the biggest healthcare real estate deals of 2023, KordaMentha’s funds management arm has bought the Epping Private Hospital and Medical in a $76 million transaction, from a syndicate led by Canada’s Northwest Healthcare Properties.

The asset was acquired on a 7.08% yield. It is anchored by Northern Health, while tenants also include Genesis, I-Med, Melbourne Pathology and Family Doctors, with public and private healthcare services available. It has a weighted average lease expiry (WALE) of 8.7 years.

Also in Epping, Boston-based investment manager Cabot Properties bought a brand-new industrial facility in a $37.69 million sale-and-leaseback deal with 99 Bikes.

The 16,117sqm facility is on a 2.44ha site at 18 Litoria Court, within stage 2 of the Biodiversity Business Park.

99 Bikes, part of Pedal Group, has an initial leaseback term of 5 years.

Dava Hotel Sells for $15.75m
The Dava Hotel, on the Mornington Peninsula, has sold for $15.75 million.

The hotel is on a 1.55ha ocean-fronting site at 614 The Esplanade, between Mount Martha and Mount Eliza. It has more than 12 years remaining on its lease to John Haddad’s Taverns of Victoria and comprises a modern bistro, TAB, public bar, gaming room with 32 machines, outdoor kids’ play area and drive-through bottle shop.

The original building on the site was constructed in the 1920s as a boarding school, before being redeveloped as The Dava Lodge Hotel and Guest House in 1935.

The vendors of the freehold, paid $5.15 million for the site in 2001.

    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.