Weekly Wrap

Fitzroys Weekly Wrap - 14th June 2024

Posted on 14th June 2024

92 Bay Street, Port Melbourne
The ground floor strata titled shop of 75sqm sold for $980,000 on a 5.7% yield. It has a 3 + 3 year lease to a hair salon and returns $57,500 pa.

238 Lygon Street, Carlton

The two level 243sqm terrace building on a 256sqm site sold for $2.005 million. Restaurant La Spaghettata occupies the property on a renewed 5-year term with 2 further options to 2038.

196 Pelham Street, Carlton

An investor bought the 183sqm building, comprising a convenience retailer and 2 apartments on a 143sqm corner site, for $2.26 million.

192 Brandon Park Drive, Wheelers Hill

An investor bought the 163sqm property for $1.052 million. Pizzeria Il Desidoria has a 5-year lease expiring at the end of March 2028 with 5+5-year options, returning $68,310pa gross.

39 Pine Street, Hawthorn
The 270sqm building on a 142sqm site was leased at $69,500pa.

127 McEwan Road, Heidelberg West
The 658sqm office and warehouse on a 942sqm site sold with vacant possession for $2.2 million.

9/22 Disney Avenue, Keilor East

The 670sqm office and warehouse, on a 744sqm site with Industrial 1 zoning, sold for $2.02 million.

32/23-35 Bunney Road, Oakleigh South

The 135sqm workshop with 3 on-site car parks sold with vacant possession for $488,888.

13 Brunswick Street, Fitzroy
An owner-occupier bought the 326sqm vacant medical freehold for $4.025 million. It is on a 286sqm site with on-site parking for 4 cars.

Quality Puckle Street Investment Sells on Tight Yield
An impressive two storey shop and dwelling in Puckle Street, Moonee Ponds has been sold to a local investor for $2.63 million.

Fitzroys’ Ervin Niyaz and Chris Kombi negotiated the sale of 116 Puckle Street, which sold on a tight yield of 3.13% on the net passing rental.

The property is leased to ASX-listed tenant ResMed.

Kombi said the deal demonstrated the desirability of Moonee Ponds as an investment destination, which had driven strong sales results.

According to Fitzroys’ Walk the Strip report series, Puckle Street has consistently recorded amongst Melbourne’s lowest vacancy rates, sitting at just 3.9% in 2023.

“We’ve seen more people embrace flexible working arrangements in the post-pandemic environment, with people looking to work closer to home in highly-accessible locations with quality hospitality and lifestyle amenity. This has underpinned trade along Melbourne’s shopping strips,” Kombi said.

The 116 Puckle Street transaction is the latest Moonee Ponds investment play in a string of deals managed by Fitzroys. Niyaz and David Bourke recently sold Levels 1 & 2, 5 Everage Street, in conjunction with Patrick O’Callaghan of O&Co, for $3.2 million three weeks ahead of the Expressions of Interest campaign close, well above expectations after Fitzroys was able to source a knockout unconditional offer that the vendor accepted prior to the campaign close.

The commercial office encompassing 842sqm was offered with a secure lease to co- working and flexible office space provider One Plus One Business Centre.

Niyaz said the property is in a highly sought-after location in the epicentre of the Moonee Ponds booming activity centre, surrounded by apartment towers, major redevelopment, and all the lifestyle, retail and hospitality that Puckle and Hall streets have to offer, as well as Moonee Ponds Central, anchored by Coles, Kmart and Aldi.

“Moonee Ponds is witnessing a generational boom. It’s seen delivery of the Mason Square precinct and more recently Penny Lane, which has brought apartments, retail and a new Hoyts cinema to the location, while the future $2 billion residential and lifestyle overhaul of the Moonee Valley Racecourse nearby has kicked off and will introduce 2,000 new dwellings as well as commercial space to the area.”

“More and more people are wanting to live, work and play in Moonee Ponds.

“Moonee Ponds ticks all the boxes. It offers excellent public transport linkages by train, tram and bus, and excellent connectivity to major road arterials and only seven kilometres north-west of Melbourne’s CBD.”

Niyaz has also recently sold the vacant building at 46 Pascoe Vale Road, moments from Moonee Ponds Junction for $1.2 million, in which another investor also put forward a strong bid, well above expectations, which was accepted by the vendor ahead of auction.

The building has been used as the offices of an architecture firm and attracted owner- occupiers and investors, with the purchaser very confident in securing a quality tenant for the asset, Niyaz said.

Lygon Street, Brunswick East Continues to Attract Strong Retail Investment Results
Investors are continuing to buy up property in high-performing Lygon Street, Brunswick East, declared by Time Out as one of the “World’s Coolest Neighbourhoods” as it moves through a generational growth phase.

Fitzroys’ Lewis Waddell and Ervin Niyaz have sold 113 Lygon Street, Brunswick East for $1.3 million, on a tight 4.5% net yield following a successful auction campaign.

Waddell said the campaign generated 60 enquiries, which culminated in four bidders competing for the property at auction.

The 150sqm building is occupied by multi-store tenant Tips and Toes on a brand-new five- year lease, on a 152sqm site located in the absolute prime trading section of the strip, surrounded by top hospitality operators and local retailers including 400 Gradi, Old Palm Liquor, Bar Idda, Maggie’s Snacks & Liquor, Bed Bath N’ Table, Messina, IGA and many more.

“Investors recognised the rarity of the opportunity to acquire a securely-leased freehold in a prime inner-city shopping strip, leased to a quality tenant,” Waddell said.

The sale follows Niyaz and Fitzroys’ Chris Kombi and Ben Liu selling 98-100 Lygon Street for $3.38 million, after a campaign that generated more than 70 enquiries and also saw four bidders competing at the auction. That sale price reflected a tight 4.7% net yield. The property has a 10-year lease plus options to highly-experienced hospitality operators trading as popular new venue Maggie’s Snacks & Liquor.

Waddell said Lygon Street, Brunswick East is home to an array of hospitality institutions that draw consistent and loyal patronage from the neighbourhood and across wider Melbourne.

“The strip has really emerged to become part of Melbourne’s world-famous inner north hospitality and culture offering.

Brunswick East was recently ranked by influential global publication Time Out as sixth on its list of “Coolest Neighbourhoods in the World”.

Niyaz said Melbourne’s shopping strips are experiencing a real period of renewal at the moment.

“Multiple residential towers in around Lygon Street, Brunswick East have boosted the captive local catchment and local trade, which will benefit further in the coming years from more residential development in the pipeline,” he said.

The location also offers excellent connectivity and exposure with trams 1 and 6 stopping directly outside the property and 22,000 cars passing by daily.

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.