This article is from the Australian Property Journal archive
BEVILLE Group has nearly doubled its money on a St Kilda Road office tower in just four years of ownership, selling number 509 at a record price for the inner city of boulevard of $163 million.
The price tag for the 1990s building of 19,500 sqm trumps the previous record of $145 million, paid by fund manager Mapletree for the A-grade 417 St Kilda Road building nearly one year ago to a syndicate overseen by Newmark Capital, which had purchased the asset for $64 million five years’ previous.
A larger price could have been achieved for 509 St Kilda Road, given a higher bid was put forward, but Beville Group was attracted to the unconditional nature of private mainland Chinese investor Michael Xie’s offer.
The fully leased counts the Australian government, Fuji Xerox and global life insurer AIA Insurance among its tenants.
It was constructed by Lendlease in the 1990s and is on a Fawkner Park-fronted double site of around 6,070 sqm at the northern end of St Kilda Road, near Domain Interchange, which is the site of a major tram stop and future location of one of the Anzac underground Metro train station.
Led by John Beville, Beville Group becomes the latest vendor to make a significant return on the purchase and sale of office assets along the precinct in just a few years of ownership. It acquired the asset four years ago for $84 million.
Last year, Perth-based syndicate Lester Group capitalised on the boom by offloading 324 St Kilda Road for $42 million, after buying it only four years earlier for $22 million More recently, Chip Eng Seng sold its 11-storey, 10,459 sqm 420 St Kilda Road office building for $68.84 million after just one week on the market, representing $23.56 million capital gain on its purchase price in 2013.
Further down the boulevard, Lian Beng Group and KSH Holdings sold the 596 St Kilda Road site for $34 million, with approval for a 19-storey, 170-apartment development, less than two years after acquiring the site for $25 million.
Office stock in the St Kilda Road precinct has reduced in size by more than 100,000 sqm over the last decade, according to Savills’ latest Melbourne Fringe Office Briefing.
Property Council of Australia data for the first half of 2018 showed prime vacancies through the precinct were at 4.9%, well below the 10-year average of 8.6%
CBRE negotiated the sale of 509 St Kilda Road.
Australian Property Journal
