This article is from the Australian Property Journal archive
A HIGH-profile corner building in Melbourne’s CBD has hit the market, offering opportunities for investors, owner occupiers and developers at a time of widespread building repositioning.
The seven-storey 333 Queen Street glazed façade building, on the corner of La Trobe Street, is up for sale for the first time in 23 years. Built in 1986, it has 6,000 sqm of net lettable area with exceptional natural light and secure basement parking, and occupies an invaluable 1,028 sqm corner landholding with dual frontage of 71 metres.
JLL’s agents Nick Peden, Josh Rutman, Tim Carr and MingXuan Li have the listing, and are expecting interest from build-to-rent and build-to-sell, student accommodation, co-living, hotel, office and hospitality developers.
“333 Queen Street provides solid fundamentals for developers, value-add investors, owner occupiers and landbankers given the incredible Melbourne CBD location, valuable corner landholding and the high-quality office building with solid income,” Peden said.
“The building is currently 85% leased to nine tenants providing strong income with massive rental reversion potential, as tenants look to upgrade their accommodation, they are weighting their decisions towards more sustainable buildings that have higher NABERS and BEEC ratings. This is largely due to the sustainability targets that major occupiers have committed to as well as the cheaper running costs of more energy efficient buildings.”
Occupier demand for higher-quality space is set to become more pronounced as net zero commitments come into play for larger organisations – many of which take on longer lease terms and have 2030 emissions targets.
“We have seen consistent evidence across the country that tenants are prepared to pay a premium for more energy efficient buildings with greater tenant amenity, which has made the financial equation for repositioning older stock more viable in 2023,” Peden said.
The building is near the recently-announced $1.7 billion redevelopment of the southern end of the Queen Victoria Market, which will include three towers and deliver 43,000 sqm of offices, 560 build-to-rent and affordable units, a 1,100 student accommodation beds and a 1.8-hectare public park.
Rutman said “there will be no end of benefit for the future owner” of the property, sitting on the doorstep of the largest urban renewal project ever undertaken by the City of Melbourne.
“We anticipate strong interest given the obvious opportunity to reposition the asset or redevelop what is one of Melbourne CBD’s last under-developed corners,” he said.
The expressions of interest campaign closes on Wednesday, 16th August.
