Versatile Lygon Street, Carlton Opportunity Sold Before Auction

Melbourne’s prime shopping strip market has passed its latest test with flying colours, with Fitzroys’ Asian services team sourcing a motivated buyer who snapped up a Lygon Street, Carlton investment well before the auction.

Chris Kombi, Shane Mills and Ben Liu of Fitzroys sold 279-281 Lygon Street, which had been set for auction on Friday, 5 September, in the first time the property had been offered for sale in 53 years.

“Fitzroys’ Asian services team was able to source a highly motivated private investor purchaser and secure a strong result just a couple of weeks into the campaign,” Mills said.

The 2-storey 165sqm building sold for $1.678 million, on a high land rate of $13,115 per sqm and sharp passing yield of 3.45%.

“The purchaser briefed the Fitzroys Asian Services desk with an appetite for a value-add opportunity within the centre of Melbourne’s busy city fringe retail strips. This high-profile property is positioned in a strongly performing section of Lygon Street, Carlton, just metres from the Faraday Street intersection, and offers an expansive frontage of more than 7.5m,” Mills said.

The ground floor is leased to a tobacconist on a 5 year term, and the first floor was offered vacant.

“The sale shows there is a clear confidence in the market in the prospects of well-located investment opportunities in Melbourne’s shopping strips,” Mills added.
Kombi said, “The market recognised this was a truly generational opportunity to invest in the prime of what is arguably Melbourne’s most famous dining and lifestyle strip,” Kombi said.

The property is surrounded by a mix of Lygon Street, Carlton’s notable traders including DOC, Brunetti, Fishbowl, Grill’d, Yo-Chi, Mecca, Peter Alexander, Johnny’s Green Room, Vintage Cellars and BWS, to name a few.

Further regeneration of Lygon Street is happening just a few metres away from the 279-281 Lygon Street property at the iconic King & Godfree building, where the deli, wine store, café and restaurant Agostino are under renovation.

The return in earnest of Melburnians dining out has Lygon Street buzzing, and an eclectic wave of new restaurants, eateries and bars have been opening up to complement the strip’s traditional Italian classics. According to Fitzroys’ most recent Walk the Strip report, vacancies on Lygon Street have come down from 20.0% in the depths of COVID to now sit at a healthy 7.5%.

Liu said the student and residential apartment developments in Carlton and nearby will further support trade and activity along the strip.

He added that good accessibility has become an increasingly important predictor of the performance of shopping strips and is being taken into account by investors.

“Lygon Street has excellent tram and bus connections in addition to plentiful public car park options, including the Elgin Street public car park providing over 200 car spaces. The brand-new Parkville Station, meanwhile, is set to open soon within walking distance from Lygon Street, as part of the Melbourne Metro Tunnel project,” he said.

Fitzroys recently managed one of the few other investment sales in 2025 on Lygon Street, Carlton. In another sale 53 years in the making, number 223 was sold with vacant possession for $1.51 million after a campaign the generated interest from investors and owner-occupiers alike.

In October, Fitzroys will be offering for sale via EOI, 327 Lygon Street, Carlton. The freehold opportunity features a renewed five-year lease to Carlton Eye Lab and a residential dwelling upstairs that has separate access.

Two Prime South Yarra Freeholds - Buy One or Buy Both

Two Chapel Street, South Yarra freeholds are headed for a September auction, presenting the chance to invest, occupy, land bank and develop in the prime of Australia’s most famous shopping strip and opposite the forthcoming $3.75 billion Jam Factory redevelopment.

Fitzroys’ Chris James and Lewis Waddell are marketing the neighbouring freeholds at 467 and 469 Chapel Street, South Yarra on behalf of private development and investment group Sterling Global. They are heading to consecutive auctions from 11am on Friday, 19 September.

Expectations for each are of mid-to-high-$1 millions.

Sterling Global is now marketing its major lifestyle development at 623 Collins Street in the Melbourne CBD, 623 Collins State Bank House.

The well-presented 2-level freehold at 467 Chapel Street property is offered with vacant possession, and comprises a 188sqm building on 167sqm of land. Number 469 is a 192sqm building on a 173sqm site and is leased to Portuguese jewellery and homewares retailer and café Gold Over Blue, returning $88,400 with all usual outgoings recovered.

“It’s a nicely-proportioned, consolidated land parcel of 340sqm in a strategic location nearly directly opposite the upcoming $3.75 billion Jam Factory redevelopment,” James said.

“Each property is well-priced, comes with off-street parking, and offers strong value-add potential.”

They are in a high foot traffic position near an array of renowned national and independent traders including Rustica, Declic, Scanlan Theodore, Kookai, D-Spa, Decjuba, M.J. Bale, Peter Alexander and more.

“We’re expecting broad interest from the market - occupiers, investors, family offices and developers - as the suburb moves through the next phase of a generational development boom,” James said.

“The Jam Factory redevelopment is set to reshape in Australia’s most famous shopping strip, delivering new commercial, retail and hospitality space, 886 apartments, two hotels and a new cinema complex.

“The sizeable increase in local residents, office workers, shoppers and tourists to the immediate area will provide a huge boost to trade and activity along the strip over the long- term.”

Gurner and Qualitas received approval from the City of Stonnington in late July for its updated plans for the project.

South Yarra businesses have benefited in recent years from intensive residential and commercial development in the suburb, namely in the Forrest Hill precinct.

Waddell said, “Well-located, highly accessible Melbourne shopping strip assets provide excellent investment and trade prospects.

“Chapel Street, South Yarra is home to a vibrant offering of fashion, food and fun that has made it Australia’s most famous shopping strip. These properties are in a prime position in the strip and offer excellent long-term prospects.”

He added that one of the key indicators to success of shopping strip is accessibility.

“There is excellent public transport amenity with trams running along Chapel Street, as well as Toorak Road and Malvern Road, and the recently upgraded South Yarra Station to the north,” he said.