This article is from the Australian Property Journal archive
A FULLY leased, tax effective investment on an expansive land parcel in Melbourne’s Lilydale has hit the market, offering potential buyers massive future potential in a high-growth area.
446 Maroondah Highway in Lilydale, around 34km north-east of the CBD, comprises an elevated 6,229sqm zoned Commercial 2 corner site, occupied by a two-level 2,412sqm securely leased building.
Paul Burns and Chris James from Fitzroys are marketing the property via an expressions of interest campaign.
Boasting 100 metres of street frontage, the site also include 100 bays of carpark allocation and is being offered with a brand new 10+5+5-lear leasing to national operator Belgravia Health & Leisure.
Accounting for 96% of the site’s leasing income, Belgravia runs 170 locations across both Australia and New Zealand and will operate three business on the Lilydale site, including a Genesis Fitness Centre, Jump Swim School and Pursuit martial arts school.
Lilydale Hair Co occupies the 85sqm balance of the property on a new seven year lease.
“Investors are looking for security and cash flow in the current environment. This is a fantastic opportunity to acquire a low-risk, high-yielding investment with a long WALE and enormous future potential,” said Burns,.
With a WALE of nearly 10-years, the building brings in returns of $532,000 per annum and has recently undergone a $3 million renovation.
“The significant building upgrade which has just been undertaken avoids the need for much or any capital expenditure, as well as providing outstanding tax depreciation benefits,” added Burns.
“Whilst the property has a long-term tenant, it is comforting to know that there is a significant surplus of tenant demand from name brands such as Kia, MG and Total Tools. These and other tenants are looking for representation in Maroondah Highway, Lilydale, however, there are no vacancies,” added Burns.
“This is likely to result in ongoing rental growth as tenants outbid one another for any alternatives that arise.”
Burns also noted that the site’s entire income comes from a site coverage of just 27%, leaving the property thoroughly underdeveloped, leaving the site as a one of the best land bank offerings in the area.
“Investors will be able to enjoy a secure income stream from a recognised tenant while assessing the value-add and development options encouraged by its location within a Major Activity Structure Plan,” said Burns.
The fast growing Lilydale, will also benefit the property’s future development and value-add potential through the Lilydale Major Activity Structure Plan (2019).
The plan encourages higher density uses for the precinct, with demand for an additional 10,000sqm of retail floorspace and 11,000sqm of commercial floorspace over the next 15 years.
The site is also well placed amongst other large format retailers, with Toyota next door and surrounding offerings including Holden, Sangyong, Suzuki, Pedders, Supercheap Auto, Repco, MycarTyre & Auto, McDonald’s, KFC and Ampol.
The expressions of interest campaign for 446 Maroondah Highway is scheduled to close 4 November 2022.
