Weekly Wrap

Fitzroys Weekly Wrap - 13th August 2021

Posted on 13th August 2021

000 Retail 05

1443 Hume Highway, Campbellfield
The Hungry Jack’s drive-through site sold for $6.415 million, at a 3.37% yield. It has a 15-year triple-net lease to Hungry Jack’s head office until 2031 with a 15-year option, returning $216,617pa plus GST, with 3.5% annual rent increases and 5% at option. The 329sqm restaurant is on a 2,409sqm site with 55 on-title car parks.

402-404 Lower Dandenong Road, Braeside

The 3,606sqm fuel station site sold for $4 million, at a 4.43% yield, with a brand-new 12-year lease to United Petroleum plus options to 2063. It returns $177,025pa net with 2.5% annual increases.

132-136 Somerton Road, Somerton

Another United Petroleum site sold with the same lease terms, for $3.85 million at a 4.48% yield. The 2,055sqm site returns $172,525pa with 2.5% annual increases.

123-127 Martin Street, Brighton

An owner occupied bought the vacant double-fronted 137sqm strata property for $1.42 million. It is on the ground floor of the new Mast mixed-use development.

650 Hume Highway, Craigieburn

Carls Jr, KFC and Jasbe Petroleum have agreed to leases from 10 to 15 years for stage 1 of APD Projects’ The Base. The Base will be constructed on a 21.6ha site with retail, services, entertainment and commercial buildings.

000 Offices 05

488 Bourke Street, Melbourne
A doctor who has been renting in the building bought a 123sqm office on level 6 for around $1 million, while an investor bought a space on the ground level for $1.5 million.

227 Collins Street, Melbourne

Columbian Migration Company paid $1.22 million for the 122 sqm corner office on level 11.

2/10-12 Blackburn Road, Blackburn

Melbourne Sports Physio is expanding, leasing the 217sqm fully-fitted office for 5 years at $70,000pa.

000Industrial 05

9 Joseph Baldwin Place, Shepparton
An investor bought the modern 1,943sqm office and warehouse for $2.735, at a 5.47% yield. It is on a 2,689sqm landholding and is leased until May 2024, plus options to 2030, to hospitality and supplies business Streamline Supplies, returning $149,471pa with 4% rent increases.

20 Hercules Street, Tullamarine

A local owner occupier bought the 550sqm office and warehouse for $1.015 million.

Unit 11, 157-161 Beresford Road, Lilydale

The 255sqm high-clearance office and warehouse sold for $647,500.

427-451 Somerville Road. Tottenham

At a speculative logistics development, national line-hauler Apex Transport and Logistics leased a new 2,465 office and warehouse for 5+5 years at $115/sqm net.

Unit 7, 2-6 Apollo Court, Blackburn

Splendid & Co leased the 480 sqm industrial unit for 3 years at $50,000pa.

000 Development 05

1076 Centre Road, Oakleigh
Sector Property Group paid $24.5 million for the 1980s home of computer game maker Atari, which produced early arcade games Pacman and Space Invaders.
The 25,000sqm site sold with a leaseback to glass surfaces manufacturer Glasskote. Sector Property Group plans to turn the site into a small warehouse/mancave development, following similar projects in Mitcham, Ringwood, Point Cook and Preston.

000 Talking Points 05

New Venue for Iconic CBD Hospitality Destination
One of the most prominent restaurant buildings in Melbourne’s famous Hardware Lane has been leased, in one of the largest CBD hospitality deals struck this year to date.

Fitzroys Associate Director James Lockwood negotiated the 5+5-year lease of 68-78 Hardware Lane to an experienced hospitality operator, at a rental in excess of $250,000pa.

The 2-level, 395sqm building was offered fully-fitted with extensive hospitality and kitchen infrastructure, and has function space on the 1st floor.

Lockwood said the new tenant will also undertake a full refurbishment of premises.

“The new tenant has over 25 years’ experience in the hospitality industry operating various bars, restaurants and function venues across Melbourne, from the CBD to waterfront Docklands sites and retail strips, and believes Hardware Lane will come back stronger than ever.

“A proven operator with experience in a range of locations, committing to a long-term lease and capital outlay on refurbishments reflects a huge vote of confidence in the CBD.”

Lockwood said enquiry for the property was strong given Hardware Lane’s status as one of Melbourne’s iconic hospitality destinations.

“Melbourne’s city and laneway culture continues to resonate with locals and tourists alike, and people are anticipating authentic Melbourne experiences after being away from the CBD.”

He said the fact that the building was fully-fitted with kitchen infrastructure was also a major factor, continuing a trend seen throughout the CBD and shopping strips since early last year.

“Fully-fitted premises offer operators a more time and cost-effective opportunity to establish or expand their business, particularly in an uncertain time during which they need to be leaner and more agile.”

Active Week for Melbourne’s Industrial West
Lendlease’s unlisted Australian Prime Property Fund Industrial has bought up 3 logistics facilities in Melbourne and Sydney from a Mirvac-run vehicle for $161 million, including 2 facilities in Altona.

The fully-leased Melbourne assets were acquired on a circa 4% yield, and adjoin existing APPF Industrial properties, offering future development by site consolidation.

They include 26 Harcourt Road, with gross lettable area of 32,329sqm and adjacent to the fund’s 21-27 Marshall Court; and 47 Westgate Drive, comprising 26,998sqm with an additional expansion site of circa 10,500sqm, neighbouring the fund’s 121-139 Dohertys Road property.

Meanwhile, ASX-listed Goodman Group bought a 125ha land parcel in Truganina for a warehousing development. Zoned Urban Growth, the site is on Riding Boundary Road, and what will become the Metropolitan Ring Road, and 88ha is developable to industrial use.

The site less than 30 minutes from the Port of Melbourne and Melbourne Airport.

According to Real Capital Analytics, industrial transactions across Australia totalled $6.3 billion in the June quarter, marking the sector’s biggest-ever total.

ESR Australia and GIC have just settled on their record $3.8 billion joint acquisition of the Milestone logistics property portfolio from Blackstone – Australia’s largest-ever property transaction – which comprised 45 assets nationally, including a Woolworths distribution centre in Truganina.

Also in the suburb, and at a Lendlease-owned facility, global e-commerce company Costway leased the 18,751sqm warehouse at 28-30 Distribution Drive for 5 years, for its 1st Australian distribution centre.

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.