This article is from the Australian Property Journal archive
A PURPOSE built government building in Footscray has hit the market, offering potential buyers a secure investment with returns of $1.065 million per annum net.
75 Moore Street in Footscray, around 5km west of the Melbourne CBD, was built for Centrelink in 2012, spanning 2,259sqm of offices across large floor plates with 40 basement car spaces.
The two-level office building occupies a 1,697sqm Activity Centre zoned site with further frontages to Byron and Shelley Streets, enabling significant medium and long-term development potential of up to 10 levels.
Paul Burns and Rob Harrington from Fitzroys are marketing the property via an expressions of interest campaign, with properties of this type and in this location typically show a circa 6% yield.
“75 Moore Street is an excellent passive investment, with the added bonus of being an exceptional land bank in one of Melbourne’s most rapidly gentrifying and trending city fringe locations,” said Burns.
“Passive investors will be attracted to the ultra-secure lease covenant to the Australian Government. The building is very modern with limited or no capex requirements.”
The property is tipped to fetch in excess of $17 million.
The vendor acquired the property before the end of the initial 10-year term, with plans to renew the lease to federal government. Despite the tenant having a 3-year option, the tenant extended for 7 years from 2022, plus options.
“The tenant agreeing to renew for a longer term reflects the governments intentions, and the fact they did not have, or expect there to be, any options, in the near term,” added Burns.
“The building is only 250 metres from Footscray train station, metropolitan Melbourne’s busiest train station. Centrelink offices need to be highly accessible to public transport so renewing was an easy decision for them.”
Footscray and the inner west of Melbourne at large are currently benefitting from billions of dollars being invested in infrastructure in the area, including the Westgate Tunnel, Footscray Hospital and Metro Tunnel.
“We’ve already received interest from developers looking to put away an asset for the next cycle. A high portion of the purchase price will be accounted for by the land which has further upside,” said Burns.
The expressions of interest campaign for 75 Moore Street, Footscray is due to close on 25 October 2023.
