This article is from the Australian Property Journal archive
THE four storey Target retail and office building on Bourke St in the Melbourne CBD is on the market.
The building once housed the Coles headquarters and has been owned by Coles since 1982.
Located at 222-244 Bourke St, the four-storey building is anchored by Target with a 20 year lease plus options and a number of speciality stores on the ground and basement levels. It includes office accommodation on Levels 2, 3 and 4 of the building, with long-lease covenants to blue chip tenants Jetstar and Monash University.
The last major transaction in the vicinity was Cromwell’s sale of the Village City Centre at 206 Bourke St in 2007 for $32.75 million.
The freehold title is being offered for sale by Expressions of Interest by Simon Rooney and James Kaufman of Jones Lang LaSalle.
Victorian director of sales and investments James Kaufman said it is rare for a large land area of this size (5748 sqm) to come up for sale with freehold title, right in the heart of the city and in Melbourne’s premier retail precinct.
“As a result, we expect strong interest from a range of buyers, including domestic private investors, international investors, particularly in the Asia Pacific region, and superannuation funds. This building provides a solid, passive investment due to its unusually long-lease covenants, quality tenants and prime location.
“This is a once-in-a-generation opportunity to acquire a premium retail and office asset.” Kaufman said.
Rooney said the Melbourne Target Centre houses one of the best performing Target stores in Australia and will be highly desirable due to its long-term lease with anchor tenant.
“The CBD vacancy rate for speciality stores fell to 1.3% in the December quarter of 2010, below the 10 year average of 3.3%. As a result, prime rents increased by 1.6% in 2010 and the rate of growth is expected to improve in 2011 and 2012.
“Melbourne’s ability to bounce back strongly from the GFC and the strength of CBD office and retail market fundamentals continue to support strong buyer interest,” Rooney concluded.
Australian Property Journal
