Weekly Wrap

Fitzroys Weekly Wrap - 23rd July 2021

Posted on 23rd July 2021

182-194 Commercial Road, Prahran
A Malaysian-backed developer bought the row of 6 faux Tudor shops, opposite Prahran Market, for $9.4 million.

216-228 Raymond Street, Sale

An investor paid $4.55 million at a 5.2% yield for Spotlight Plaza. The 1,908sqm complex is on a 6,774sqm site with a 10-year lease to anchor tenant Spotlight, which along with 3 additional shops returns $240,000pa net.

187 Johnston Street, Collingwood

Art Gallery Tacit leased a gallery space for 3 years in addition to its existing space at 191-193 Johnston Street. It will pay $50,000pa plus outgoings and GST for the 2-level, 240sqm building.

367 and 369 Chapel Street, South Yarra

The neighbouring properties, both 86sqm, were each leased at $40,000pa net to a phone repairs business and a gift shop respectively.

443 Upper Heidelberg Road, Ivanhoe
An interstate investor bought the 822sqm ground floor office, leased to ISN Psychology College, for $5.29 million. ISN has a 10+5+5-year lease from April 2019 that returns $358,817pa plus outgoings and GST. Located within a mixed-use development, the property also has 21 allocated on-title parking spaces.

2/10-12 Blackburn Road, Blackburn

Melbourne Sports Physio leased the 217sqm fully-fitted office on a 5+3+3-year term at $70,000pa. It has open plan and partitioned offices, amenities, and 8 parking spaces.

24 Liddiard Street, Hawthorn

E-commerce business Working Party will pay $60,000pa net over 3 years for the office.

183a Greville Street, Prahran

A psychology practice agreed to a 3-year lease over the 100sqm space at $35,000/sqm

6 Sigma Drive, Croydon South
The 813sqm office and warehouse on a 1,003sqm site sold for $2.3 million, at a 5.25% net yield. It is leased to 2 tenants and returns $112,179pa plus outgoings and GST with 4% fixed annual increases.

31-33 Moore Road, Airport West

A local owner occupier bought the 1,000sqm office and warehouse for $2 million.

21A Regina Street, Ballarat

The warehouse home to Regina Glass Fibre sold for $1.3 million on a 6.76% yield. Regina has a 7-year lease returning $88,000pa.

1/50 Star Crescent, Hallam

A local investor bought the 415sqm high clearance factory for $810,000, on a 3.9% yield. It currently returns $31,830pa plus outgoings and GST.

56 Parkwest Drive, Derrimut

Logistics provider Qube signed a 2-year lease for the 16,000sqm facility at $1.248 million pa, or $78/sqm gross. The Charter Hall-owned property was recently vacated by Australia Post.

26 Harker Street, Burwood

The 499sqm office and warehouse with 11 undercover parking spaces was leased at $74,850pa plus outgoings and GST.

2-4 Kingsway, Glen Waverley
A local investor with development intentions paid $10.5 million for the triple-fronted property, which has approval for a 6-level commercial building designed by architects RotheLowman. The site is zoned Commercial 1 and is opposite The Glen shopping centre.

20 Lower Heidelberg Road, Templestowe

A local developer bought the 1,350sqm residential corner site for $3.557 from a local resident with plans for a boutique residential project.

11 Assembly Drive, Dandenong South
An interstate investor bought the childcare centre property for $8.628 million at a 4.6% net yield. Kool Kidz has a 15+10+10-year lease returning $405,600pa plus outgoings and GST. The vendor bought the property 18 months ago for $6.37 million.

Rustica Signs on for Landmark Queen & Collins project
Renowned baker Rustica will open its newest offering within GPT Group’s landmark Queen & Collins development in the Melbourne CBD.

Fitzroys’ James Lockwood and Rick Berry along with Future Proof Retail and Hospitality’s Mitchell Humphreys negotiated the lease for ASX-listed GPT.

Rustica will take up position as the flagship café in the development, offering its quality baked goods, breakfast and lunch fare and coffee as part of Queen & Collins hospitality and lifestyle offering for workers, visitors and all Melburnians.

Rustica is in the process of fitting out its new 163.5sqm space on the corner of Queen and Little Collins Street, next to the main Queen & Collins tower entrance. The project is expected to welcome the first office workers in August.

“We're really excited to be moving into the Queen & Collins development, rich with history and amazing Venetian-Gothic architecture,” Rustica founder, Brenton Lang said.

“Our fit-out will pay homage to the original building's design and be a little left-field from previous Rustica sites.

“Expect to see all your favourite Rustica breakfast and lunch go-tos across all days of the week, plus an extensive grab-and-go offering for city workers on the run.”

Lockwood said this commitment from an iconic and experienced name in Melbourne’s renowned café and hospitality scene is a huge vote of confidence for the future of the CBD, as well as the Queen & Collins development. This will follow Rustica’s maiden site in South Yarra, and sites at Highpoint, Melbourne Central and Rialto.

The Queen & Collins redevelopment has reimagined the 34-storey tower, formerly home to the headquarters of ANZ, and upgraded the adjoining Melbourne boom-time heritage buildings – the Safe Deposit Building at 90 Queen Street, and the former Stock Exchange Building at 380 Collins Street. Connectivity between the buildings has been enhanced by a series of semi open-air laneways, courtyards and intimate squares referred to as 'Campiellos'.

Lockwood and Berry are managing the leasing campaign of the 1,100sqm retail space in the development’s lower levels along with Mitchell Humphreys. This will create retail experiences and character-filled spaces through restaurants, cafés and shops. The precinct features a grand restaurant dining space, in the Stock Exchange Building’s antechambers, as well as a new basement car.
Lockwood said lifestyle and hospitality attributes as part of a holistic work experience have never been more important.

“They can make these developments more than an office building. They can become a destination in their own right, whether it be to get a coffee, meet for breakfast or go out for lunch.”

“In a period of widespread space and location reassessment and flexible working arrangements, attracting workers to the office and the CBD on a day-to-day basis requires exceptional offerings such as this.

“They also present a huge attraction to businesses wanting to attract and retain top-tier talent.”

Berry said quality hospitality operators are increasingly looking to character buildings and fit-outs to provide something unique not just for employees within the building, but all city workers, visitors and Melburnians.

Regional Retail Assets Changing Hands
Nearly $100 million worth of convenience-based retail assets have sold across regional Victoria, as investors seek defensive assets that continue to trade well through the COVID period.

The Coles-anchored Torquay Village neighbourhood shopping centre traded for $40 million on a circa-5% yield. It also has 15 specialty shops and is on a 1.4ha site. The vendor was a private investor who bought the asset 3 years ago from Coles for $35 million, on a 5.9% yield.

Coles Morwell, including a Liquorland and complemented by 7 non-discretionary specialty shops, was sold for almost $28 million, on a 4.94% initial yield. The 5,265sqm centre is on a 1.1ha site.

Another Coles, in Swan Hill, was bought by a Melbourne-based investor for $20 million. The 3,452sqm centre is on an 8,320sqm parcel and includes a Liquorland and 4 specialty shops, and returns $1.079 million pa. The sale price reflected a 5.3% yield. Built in 1995, it had been a Bi-Lo supermarket and was converted into a Coles in 2012, and had been owned by Victoria Square Enterprises since 2003.

Meanwhile, an offshore private investor bought the 7,465sqm Bunnings Warehouse property in Horsham for $9.8 million from a consortium of New Zealand-based investors. Bunnings has a lease until 2025.

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 2021 Fitzroys.