This article is from the Australian Property Journal archive
ANOTHER round of assets has been listed in Melbourne’s popular eastern suburbs office market, including a 2.62-hectare site opposite the Tally Ho Business Park in Forest Hill that is expected to reap more than $50 million.
Zoned Commercial 1, the 347-351 Burwood Highway property comprises two office buildings that are more than 70% leased and a multi-storey car park, and offers a land bank opportunity with future redevelopment potential.
Both buildings have recently undergone upgrades of a combined $13 million, and would reflect a capital value rate of below $5,000 per sqm, compared to city fringe buildings that are currently selling between $7,000 and $9,000 per sqm.
Number 347 is a modern office building 100% leased to high calibre tenants including NEC Australia, Bolton Clarke and Petite Early Learning Childcare, while 351 Burwood Highway is 43% leased to Diagnostica Stago, Mackillop Family Services and Hamilton Morello.
The buildings provide a combined net lettable area of around 10,692 sqm, a WALE of 3.9 years and net passing income of $3.4 million per annum, and a high car parking ratio of more of six cars per 100 sqm.
A rental guarantee will be provided over the balance of vacant space and cars.
Colliers International is marketing the asset via expressions of interest.
A China-based investor recently paid $25.5 million for the VicRoads headquarters within Tally Ho itself, following the sale of 16 Lakeside Drive within the business park and 255 Whitehorse Road in Balwyn to Hong Kong-listed Glorious Sun for a combined $28 million, and Hawthorn’s converted Congregational Church for $9.85 million.
Around the same time, News Corporation Australia sold the 1 Chapel Street building in Blackburn, home of Leader Newspapers, to Vantage Property Investments for $30.2 million.
Meanwhile, the Dennis Family Homes offices in Malvern have also been put up for sale with expectations of more than $15 million. The two-level corner building at 207-213 Waverley Road has being offered by Momentum Wealth Management Group director Paul Huggins, who acquired the asset in 2014 for $7.85 million in a sale leaseback deal with the Dennis family.
Dennis Family homes has three months remaining on its lease.
In Canterbury, a three-level building of 1,861 sqm at 19 Shierlaw Avenue is also up for grabs. It is leased to Scentific Management Associates and Price Gibson, and is likely to bring around $9 million.
The 7-Eleven offices in Mount Waverley round out the latest slew of offerings, and are expected to attract more than $8.5 million. The 2,007 sqm, two-level building at 357 Ferntree Gully Road is leased until 2019 with a holding income of $750,000.
The convenience store giant is readying its move to PodCo and Terraplex’s Building 2 at 658 Church Street in the hot inner-city pocket of Cremorne, and taking up the Just Group space alongside Starbucks and Withers Group.
Australian Property Journal
