Melbourne’s city fringe commercial property market continues to attract strong interest from owner occupiers and developers, with a Port Melbourne landmark the latest asset to trade at a premium.
James Lockwood and David Bourke of Fitzroys sold 226 Bay Street for $3.705 million under the hammer on behalf of a long-term private owner. The prominent circa-1887 building is the former home of the Port Melbourne Building Society and located in the prime section of the Bay Street retail and lifestyle strip.
Constructed in the Victorian Free Classical style, the vacant 508sqm two-level building is on an invaluable 254sqm triple-fronted corner site with a wide 10-metre frontage to busy Bay Street.
The sale price reflected a high land rate of $14,500 per sqm.
Lockwood said strong interest ultimately led to multiple owner occupiers and developers bidding at the fiercely contested auction.
“The competitive campaign and auction reflected the generational opportunity on offer to acquire one of Port Melbourne’s landmark freeholds, and heightened demand from owner occupiers and developers for city fringe locations as the CBD office market experiences remarkably tight conditions,” he said.
“The property’s prime position within the busy retail and hospitality Bay Street strip, proximity to the Melbourne CBD and Port Melbourne Beach, as well as multiple public transport routes and major arterials, offered attractive lifestyle and accessibility attributes.
“These have become key drivers for owner occupiers and businesses looking for new locations, particularly as the CBD fringe office market becomes increasingly popular and Melburnians seek to live, work and play across the inner city in growing numbers.”
Of Melbourne’s iconic retail and lifestyle strips, Bay Street has been one of the biggest beneficiaries of medium and high-density development in recent times, revitalising the precinct and bringing crowds throughout all hours to the popular cafés, eateries and historic pubs. According to Fitzroys Walk the Strip report, Bay Street, Port Melbourne retail vacancies tightened 3.0% over 2018/19, one of the lowest across Melbourne.
Bourke said Bay Street’s location close to the intensive residential and commercial development expected in the nearby Fishermans Bend precinct, as well as Southbank, means it is well-placed to benefit from a growing catchment in the future.
He said Bay Street has retained much of the Victorian-era shopfront architecture and local landmarks.
“Character attributes such as these provide a further point of difference for owner occupiers and businesses, as well as shoppers and diners.
“Local 19th century icons dotting the famous precinct include the Town Hall, police station and post office buildings, as well as 226 Bay Street, while the influence of the port and its dockers is evident in prominent corner hotels that were also built through the 19th century,” he said.
The Port Melbourne Building Society originated in 1884 and a provisional committee of more than 100 members was formed. The Society’s success in Port Melbourne, South Melbourne and the surrounding suburbs prompted expansion within 18 months, and Allotment 20 of Section 20 was purchased due to its central location. The building was converted to a maisonette by a Dr. Potter in 1942. It has been home to Meeco (Australian Medical & Scientific Systems Ltd), and earlier this century travel agents Port Travel.