This article is from the Australian Property Journal archive
ONE of Melbourne's most recognisable sites, the home of Hotel Saville in South Yarra, has been snapped up by a local developer, after more than 200 enquiries.
Colliers International’s Ben Baines and Ted Dwyer negotiated the sale of 1-5 Commercial Rd and 270 Punt Rd in South Yarra for more than $7 million, just 24 hours after campaign close.
There is speculation that Channel 9’s successful TV program The Block, is the buyer.
1-5 Commercial Rd is a 940 sqm site currently trading as the Hotel Saville, which was sold with vacant possession, and 270 Punt Rd is a 450 sqm vacant block, currently utilised as additional car parking for the hotel.
Built in 1970s, Hotel Saville is one of the most recognisable buildings in the South Yarra skyline due to its octagonal shaped façade. It is currently a 3.5 Star motel facility with 35 rooms.
Baines said the two parcels of land have been sold together to one local developer.
“The properties were on the market for just five weeks and obtained in excess of 200 enquiries with 10 formal Expressions of Interest submitted. Interest came from local and offshore residential developers as well as hotel/motel operators.
“It was a very rare opportunity to acquire a landmark property offering such substantial upside potential. Due to the underutilised nature of the two sites, both properties offered potential for refurbishment or redevelopment,” he added.
Baines said the sale is another example of local developers fighting back against the tide of offshore investors.
“Local developers are still dominant in Melbourne’s suburban markets given their knowledge of owner-occupiers who will ultimately be purchasing the end product. This is in contrast to many of the CBD developments which are targeting investors, particularly those based overseas.
“That being said, offshore groups are increasing their activity and enquiries on suburban sites and as such we are likely to see high profile sites in the suburbs start to be snapped up by offshore groups, in particular larger sites with potential for in excess of 60 apartments,” he continued.
“Market confidence within the suburbs is as strong as we have seen since before the GFC, with residential development sites now consistently transacting for in excess of around $130,000 per potential apartment. Looking back 24 months, it was rare for apartment sites to achieve more than $100,000 per potential apartment,” Baines said.
Property Review
