Weekly Wrap

Fitzroys Weekly Wrap - 17th April 2020

Posted on 17th April 2020

000 Retail 05

122 Highfield Road, Camberwell
A local private investor bought the 2-storey freehold, on a 217sqm site next to Highfield Park, for $1.38 million at a 4.4% yield. Popular café Dish & Spoon has a new 5+5+5-year lease returning $62,653pa plus GST.

460 Church Street, Cremorne
The 130sqm double-storey building on a 186sqm site, occupied by a Thai restaurant, sold for $1.75 million. The 3+3-year lease returns $66,170pa.

85 Great Ocean Road, Anglesea
Zoned Commercial 1, the vacant single-storey building sold for $1.15 million. It is on a 214sqm site within the Anglesea retail and commercial precinct.

289 Wantirna Road, Wantirna
The 168sqm former milk bar and residence sold for $610,000, and is on a 385sqm site zoned General Residential 1.

2/302-304 Whitehorse Rd, Nunawading
A subsidiary of ASX-listed Viva Leisure leased the 1,002sqm former furniture store on the corner of Varman Court to operate a gym and health club. It signed a 10-year lease at $265,000pa.

3A/276 Flinders Street, Melbourne
Gelato retailer iScream signed a 5-year lease at $7,000/sqm for the 26sqm ground floor space, located at the bottom of a commercial tower owned by Fivex and opposite Flinders Street station.

129-135 Bouverie Street, Carlton
Expanding convenience store chain CT Mart leased 78sqm at the base of student accommodation complex UniLodge Lincoln House for 5 years at $70,000pa gross.

000 Offices 05

258-264 Gray Street, Hamilton
The 1,370sqm building fully leased to the Federal and State Governments sold for $6.75 million. Centrelink has a 10-year lease plus options to 2029, and the Victorian Department of Health & Human Services a 10-year term with options to 2033. The property is on a 2,987sqm site with 41 on-title car parks.

5 Claremont Street, South Yarra
Active International leased the 131sqm space within Claremont Manor for 5 years at $635/sqm gross.

176 Wellington Parade, East Melbourne
UK-based environmental consultant SLR Consulting leased the 592sqm space overlooking the MCG parklands at $480/sqm net.

417 St Kilda Road, Melbourne
Foresters Financial signed a 5-year lease for 465.6sqm on level 4 from $440 to $460/sqm net, taking over the lease of previous tenant Tandem.

000Industrial 05

97 Bangholme Road, Dandenong
A developer bought the 10,880sqm parcel for $4.05 million, and intends to build an office and warehouse on the property.

2 McLennan Drive, Kensington
The 309sqm office and warehouse unit with 3 on-site parking space sold for $795,000, with a lease until the end of this year returning $36,508pa.

32-34 Lindon Court, Tullamarine
Elite Tile Imports is expanding into Melbourne from Sydney, leasing the 1,367sqm facility 2+2+2 year at $144,000pa.

3/30 Prohasky Street, Port Melbourne
Fibre optic network firm Optical Solutions Australia leased the 922sqm building with a ground floor showroom, 1st floor office and warehouse for 5+5-years at $170,000pa.

44 Lillee Court, Tullamarine
Security door and blinds specialist Wynstan Designs Pty Ltd signed a 5+5-year lease for the 1,604sqm office and warehouse at $145,000pa.

000 Specialised 05

627 Victoria Street, Abbotsford
Disability accommodation provider Summer Housing paid more than $8.5 million for 11 apartments within Salta Properties’ development The Park House. The off-the-plan deal includes 10 two-bedroom units and one single-bedroom apartment for a full-time carer. Summer Housing will modify the apartments to suit residents' needs. The Park House project comprises 531 apartments across 2 buildings, due for completion in July and November.

000 Talking Points 05

Tenants Take the Plunge
Low interest rates and high office rents are prompting smaller businesses to take advantage of market and economic conditions and acquire their own premises.

Fitzroys agents Chris Kombi and Tom Fisher have sold a commanding 2-storey Victorian terrace for $1.725 million, to an owner occupier looking to relocate from their nearby office.

Zoned Commercial 1, the 180sqm building on a 144sqm site has been utilised as an office and comprises five principal rooms and amenities, balconies at the front and rear and an internal staircase and has a rear paved courtyard and rear access from Brooke Street. The sale price reflected a land rate of around $12,000 per sqm.

Kombi said the property sold via a competitive campaign that was seamlessly converted from an Auction to an Expressions of Interest campaign.

“Despite these unusual times, we are finding there is still solid buyer activity, particularly for properties which are not commonly available,” he said.

“Buyers who are familiar with a particular asset class or sector of the market will always be able to identify great opportunities.”

The property offers potential for a wide range of uses including retail, office, residential or a combination, positioned within one of Melbourne’s most prestigious lifestyle precincts.

“Versatile double-storey Victorian terraces are rarely offered to the market, and the property’s location within the highly sought-after Albert Park Village made this an especially unique proposition that attracted strong interest from owner occupiers and renovators,” Kombi said.

He said smaller businesses are finding it more financially viable to owner occupy rather than lease.

“With interest rates at historical lows and rental rates for quality inner-city office space climbing, many tenants are taking the plunge and opting to purchase instead of lease.

“This has proven to be a great wealth creation strategy for those that can afford the transition from tenant to owner occupier.”

Woolworths Furthers Sale and Leaseback Program
Woolworths has divested Keysborough South Shopping Centre for $33.13 million as part of an ongoing sale and leaseback program of its retail assets.

A local investor bought the recently-built 5,437sqm neighbourhood centre, on an 18,440sqm corner site fronting Chapel Road and Hutton Road. It is anchored by a 4,201sqm Woolworths supermarket and has 8 specialty retailers and 277 car spaces.

The deal includes a 10-year leaseback to Woolworths, and the sale price reflected a 5.4% yield.

Both Woolworths and Coles have been selling supermarkets and shopping centres across the country in recent years. Coles sold a 10,000sqm Boronia neighbourhood centre anchored by one of its supermarkets and Kmart late last year for around $35 million with a 12-year leaseback agreement.

Brunswick Market Buy
Nine Buildings, a joint venture between Aesop founder Dennis Paphitis and Canberra-based developer Molonglo, has paid $17 million for the Brunswick Market site, which becomes the suburb’s latest notable property to be earmarked for residential development.

The Market is expected to continue operating for the foreseeable future while the new owners work on plans for an apartment project. Zoned Commercial 1, the 3,059sqm site at 655-661 Sydney Road and 50-52 Breese Street has 4 street frontages and a height preference up to 7 levels. It has been home to the Market for more than 20 years.
The vendors had owned the property since 2004.

In recent months in Brunswick, Stockland and Mirvac have acquired 1.4ha of adjacent industrial land that will be turned into apartments.

Stockland bought the 4,010sqm 429-435 Albert Street site for $15 million last month. The timber yard was recently rezoned to allow for residential use, and Stockland expects to build 10 townhouses and 140 apartments in response to increasing demand for urban infill development.

The site adjoins Clifton Park and is opposite Gilpin Park, and is next to the 1ha site at 395-403 Albert Street for which Mirvac paid $40 million late last year with intentions for a build-to-rent project more than 400 dwellings and an end value of $200 million-plus. It will be partly developed in partnership with Milieu Property, which had recently bought 395 Albert Street.

Golden Age Group Buys In Glen Waverley
Developer Jeff Xu of Golden Age Group has bought a 1.65ha Glen Waverley site for $23 million from registered charity and not-for-profit childcare provider bestchance.

Zoned General Residential, 583 Ferntree Gully Road currently has a childcare centre and other educational buildings, and bestchance will continue providing childcare services and operating its Cheshire School from a portion of the site it has retained.

Brandon Park Shopping Centre is across the road, and Chadstone a short drive away. Golden Age Group is also undertaking a $450 million development above Vicinity Centres’ The Glen shopping centre, which will have 555 apartments across 3 towers.

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 2020 Fitzroys.